20 Most-Overlooked Tax Breaks and Deductions
You have to claim all the write-offs you're entitled to if you really want to cut your income tax bill to the bone. Unfortunately, though, people often miss great tax-saving opportunities because they don't know that certain tax breaks exist. And you're completely out of luck if you don't discover them before the amended return deadline has passed.
If you don't want that to happen to you, check out our list of 20 frequently overlooked tax breaks and deductions. You may uncover a hidden gem that turns your 2019 return into a money-saving masterpiece.
Don't Unnecessarily Report a State Income Tax Refund
There's a line on the tax form for reporting a state income tax refund, but most people who get refunds can simply ignore it, even though the state sent the IRS a copy of the 1099-G you got reporting the refund. If, like most taxpayers, you didn't itemize deductions on your previous federal return, the state tax refund is tax-free.
Even if you did itemize, part of it might be tax-free. It's taxable only to the extent that your deduction of state income taxes the previous year actually saved you money. If you would have itemized (rather than taking the standard deduction) even without your state tax deduction, then 100% of your refund is taxable--because 100% of your write-off reduced your taxable income. But if part of the state tax write-off is what pushed you over the standard deduction threshold, then part of the refund is tax-free. Don't report any more than you have to.
Out-of-Pocket Charitable Deductions
It's hard to overlook the big charitable gifts you made during the year, by check or payroll deduction (check your pay stub in December).
But little things add
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