Pay attention to these costs throughout the year. If you find you're getting close to the limits, think about bunching as many deductible costs as you can into this tax year.
In the example above, if your medical costs are at $4,750, get to your optometrist's office by Dec. 31 for that second pair of reading glasses you've been meaning to buy. If your out-of-pocket expenses for the eye exam and new glasses exceed $250, you'll be able to claim the excess as a medical deduction on your next tax return.
Many deduction options
For miscellaneous expenses, think about prepaying any business magazine subscriptions or professional dues early to help you over the 2% mark.
If you looked for a new job this year, be sure to count your job-hunting expenses here, too. Just remember that your job search has to be in the same field in which you're already employed.
Do you have a hobby that nets you a bit of extra spending money throughout the year? Any costs you had toward that hobby can be totaled up as a miscellaneous expense. But you can't deduct more than you made on the hobby.
Write off your taxes, too
And if this whole deduction process is just too taxing for you and you pay a professional to figure it out, here's a final itemizing gift from the IRS: Fees paid to tax preparers are also deductible as a miscellaneous expense that can further cut your tax bill.
There are, however, a couple of downsides to this tax strategy.
Some items you might bunch into one tax year could cost you if you end up facing the alternative minimum tax. Some prepaid items, such as property and state income taxes, aren't deductible under AMT rules.
Not an annual advantage
Also, bunching deductions usually helps you out only every other year.
Generally, if you bunch your expenses into one year, you will find you don't have enough to be of use the following year. In those "off" tax years, your itemized expenses will just be smaller or, for some taxpayers, it might be more worthwhile to claim the standard deduction those years.
But getting the breaks only on alternate tax filings is still much better than missing out on them every year.