Tax Deduction - WalletPop

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Should you take the standard deduction or itemize? Learn all about tax deductions and make sure you aren't paying more taxes than you actually owe.

10 ways to maximize your tax deductions -- without itemizing

Kelly Phillips Erb Feb 9th 2010 @ 6:30AM EST Filed Under: Tax, Tax - Advice, Tax - Deduction

Too often, taxpayers are led to believe that if they don't itemize, then there are no real deductions available to them beyond the standard deduction. In reality, there are a number of deductions that a taxpayer can claim without itemizing.

Here are 10 ways to maximize your tax deductions -- without going through the trouble of itemizing:

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Real estate tax tips for 2010

Amy Pyle Feb 2nd 2010 @ 8:00AM EST Filed Under: Real Estate, Mortgages, Tax - Credit, Tax - Deduction, Refinancing

The real estate downturn that dominated 2009 leaves many on unfamiliar ground at tax time. Where better to look for advice than in suburban Los Angeles, where property values took a particularly vicious dive. There, Woodland Hills investment adviser Mark Kennedy shared his tips with WalletPop:

On Foreclosure: "Homeowners here are really getting screwed. If they do what's called a deed in lieu of foreclosure, their credit gets slammed, just like a foreclosure, and then, even if the bank forgives you, the IRS does not. Say you borrowed $500,000 and the house now is only worth $300,000. You would get a deficiency 1099 from the IRS for that difference. Doesn't make sense, but that's the rule."

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Overlooked deductions: job search expenses

Kelly Phillips Erb Feb 1st 2010 @ 2:45PM EST Filed Under: Tax, Tax - Advice, Tax - Deduction

The national unemployment rate stands at a whopping 10% -- higher than it has been for years. Despite all the talk in Washington about creating new jobs, the outlook is pretty scary: When the economy was recovering from the 2001 recession, it took two years to reduce the unemployment rate by nearly a full percentage point. For that to happen in 2010, a net total of about 3 million jobs would have to be created.

Realistically, that means tens of millions of Americans were searching for new jobs in 2009. Job interviews, resumes, and fees related to a job search can add up. Fortunately, those expenses are deductible on your federal income tax return. Here's what you need to know:

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From dependent credit to filing jointly, WalletPop experts take on your questions

Lan N. Nguyen Jan 29th 2010 @ 12:00PM EST Filed Under: Bankruptcy, Tax - Advice, Tax - Deduction

The tax code is over 18,000 pages long. And it's so complex that even Wall Street wizs like Treasury Secretary Tim Geithner make mistakes on their tax returns. WalletPop's experts are on hand to help answer your questions and correct mistakes before it's time to file.

Question:
I have been filing single with one dependent. I make less than $17,000 a year. My daughter is single, 19 years old and graduated high school May of 2009. She has worked and probably made less than $10,000 last year. I really need to claim her on my taxes if I can. She lived with me for over six months last year. I am getting conflicting advice. Some say that I can claim her all year and she can claim zero on her taxes. Some say that I can only claim her for six months, but I am not sure how that works -- how does she claim herself on her taxes?
--Elizabeth Weber, 43, Marana, AZ

Answer from Ralph Hymans, CPA based in Charleston, SC
With the facts presented, you should file your return as the head of household with one dependent. Your daughter must file her own return as a single because of her income in 2009, and she cannot take an individual deduction for herself.

You are allowed to do this because she is a dependent; your daughter is under the age of 19. Filing as head of household gives you your greatest tax benefit. The fact that your daughter lived with you for less than 12 months in 2009 is not relevant to the issue. The key issues are your daughter's status as single and her age of 19.

Continue reading From dependent credit to filing jointly, WalletPop experts take on your questions

5 tips for maximizing tax deductions

Kelly Phillips Erb Jan 24th 2010 @ 7:00PM EST Filed Under: Tax, Tax - Basics, Tax - Deduction

When it comes to deductions, many taxpayers miss out -- not because they don't qualify for the deductions, but because they fail to keep good records. It's often difficult to remember on April 15 all of the miles you've driven, charities you've supported and taxes you've paid. Here are five tips for maximizing your tax deductions throughout the year:

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8 commonly overlooked tax deductions

Kelly Phillips Erb Jan 22nd 2010 @ 5:30PM EST Filed Under: Tax, Tax - Basics, Tax - Deduction

If you keep good records, deductions can be a great way to reduce your taxable income. Increasing your allowable deductions means the less tax you owe and the more money you get to keep.

To maximize your deductions, it's a good idea to familiarize yourself with tax rules -- there are likely many deductions that you're missing out on. To get you started, here's a list of eight commonly overlooked tax deductions:

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Desperate moves: Consumers' belongings held hostage by moving companies

Mitch Lipka Jan 16th 2010 @ 9:00AM EST Filed Under: Transportation, Fraud, Consumer Ally, Tax - Deduction

William Pollock was doing all the right things to set up his family's move from Texas to Pennsylvania.

He contacted reputable movers and he had them come out to his house and provide written estimates. But the estimates Pollock received were higher than he wanted to pay so he kept looking. On Craigslist, he saw an ad that pointed him to a professional-looking web site depicting a locally-based mover, Moo-ving.com, who could do it all for less. He went with them.

"It's easy now to look back and say this was a red flag and this was a red flag," Pollock says.

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From IRA distribution to tax credits, WalletPop experts answer your questions

Lan N. Nguyen Jan 14th 2010 @ 1:30PM EST Filed Under: Tax - Basics, Tax - Advice, Tax - Credit, Tax - Deduction, 101 taxes

It's 91 days before April 15 -- time to get your house in order. Our experts are here to tackle your issues, from IRA distribution to property and school tax credits.

Question:
Our home was destroyed by a fire in 2004, and my wife was inside the house and developed chronic bronchitis from smoke inhalation. We built a new home on the same property, but the new home seems to be contaminated. Eventually, my wife had to move out to get away from the irritant.

I began looking for a condominium and found one in late November 2009. I did not have time to start a mortgage application, so I took money out of a traditional IRA with the intention of rolling over that amount within 60 days. In order to get the money to put back in to an IRA, I started refinancing on our house in late December. This took some time, and it was not sufficient to cover the amount I needed.

I had some favorable rates on credit card balance transfers and proceeded to send three balance transfers to my chosen IRA holder.

To complicate matters further, my wife's purse was stolen prior to my issuing the transfers and an identity theft protection service was put into effect. This resulted in the credit card companies holding the balance transfers until they could confirm with us that the transaction was properly authorized.

I calculate that it was 63 days until the deposits were credited. Is there any means to get an extension from the IRS that would allow the deposits to qualify as a rollover?

If not, is there any way to reduce the tax burden on the amount I will have to enter into Gross Income, such as averaging over future years? I must file an estimated tax payment by January 15 in order to avoid penalties when I finish my return. Do the medical problems and theft help with the decision from the IRS?

--Ronald T. Clasmer, 62, Oklahoma City

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From deductions to IRAs, our experts answer your questions

Lan N. Nguyen Jan 5th 2010 @ 1:45PM EST Filed Under: Retirement - 401(k), Retirement - 403(b), Retirement Advice, Tax - Advice, Tax - Deduction

Now that we've rung in 2010, it's time to think about our fiscal health. And with tax season only four months away, the sooner you get started, the less panicked and stressed out you'll be. After all, isn't one of your New Year's resolutions to reduce stress in your life? Our experts tackle two such questions to help you get started.

Question:

I sold stock at a $15,000 long-term loss in 2009. I never have enough deductions for the long form itemization but was told that I couldn't deduct the losses. I have some long-term gains that could be sold. How much loss can I take a year? How much gains can I sell? Can I itemize if, say I take $10,000 in gains and offset $10,000 in losses and carry over $5,000 into next year?
-- Corbett

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