10 overlooked tax breaks

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You put off filing your Form 1040 until the Oct. 15 extended deadline. Now make sure that you didn't waste this extra filing time by overlooking some common tax breaks.

Here are 10 tax breaks -- some for itemizers only, others that any filer can claim -- that often get overlooked but could save you some tax dollars.

1. Additional charitable gifts

Everyone remembers to count the monetary gifts they make to their favorite charities. But expenses incurred while doing charitable work often aren't counted on tax returns.

You can't deduct the value of your time spent volunteering, but if you buy supplies for a group, the cost of that material is deductible as an itemized charitable donation. Similarly, if you wear a uniform in doing your good deeds -- for example, as a hospital volunteer or youth group leader -- the costs of that apparel and any cleaning bills also can be counted as charitable donations.

So can the use of your vehicle for charitable purposes, such as delivering meals to the homebound in your community or taking the Boy Scouts or Girl Scouts troop on an outing. The IRS will let you deduct that travel at 14 cents per mile.

2. Moving expenses

Most taxpayers know they can write off many moving expenses when they relocate to take another job. But what about your 1st job? Yes, the IRS allows this write-off then, too. A recent college graduate who gets a 1st job at a distance from where he or she has been living is eligible for this tax break. This tax break is found in the adjustments to income section at the bottom of Form 1040.

3. Job-hunting costs

While college students can't deduct the costs of hunting for that new job across the country, already-employed workers can. Costs associated with looking for a new job in your present occupation, including fees for resume preparation and employment of outplacement agencies, are deductible as long as you itemize. The one downside here is that these costs, along with other miscellaneous itemized expenses, must exceed 2% of your adjusted gross income before they produce any tax savings. But the phone calls, employment agency fees and resume-printing costs might be enough to get you over that income threshold.

4. Military reservists' travel expenses

Members of the military reserve forces and National Guard who travel more than 100 miles and stay overnight for the training exercises can deduct related expenses. This includes the cost of lodging and half the cost of meals. If you drive to the training, be sure to track your miles. You can deduct them on your 2014 return at 56 cents per mile, along with any parking or toll fees for driving your own car. You get this deduction whether or not you itemize; it's one of the above-the-line deductions found directly on Form 1040. But you will have to fill out Form 2106.

5. Child care credit, and more

Millions of parents claim the child and dependent care credit each year to help cover the costs of after-school day care while Mom and Dad work. But some parents overlook claiming the tax credit for child care costs during the summer. This tax break also applies to summer day camp costs. The key here is that the camp is a day-only getaway that supervises the child while the parents work. You can't claim overnight camp costs.

Remember, too, the dual nature of the credit's name: child and dependent. If you have an adult dependent who needs care so that you can work, those expenses can be claimed under this tax credit.

6. Mortgage refinance points

When you buy a house, you get to deduct the points paid on the loan on your tax return for that year of purchase. But if you refinance your home loan, you might be able to deduct those points, too, as long as you use refinanced mortgage proceeds to improve your principal residence.

7. Many medical costs

Taxpayers who itemize deductions know how difficult it often is to reach the adjusted gross income threshold required before you can claim any itemized medical expenses on Schedule A. It might be easier to clear that earnings hurdle if you look at miscellaneous medical costs. Some of these include travel expenses to and from medical treatments, insurance premiums you pay for from already-taxed income and even alcohol- or drug-abuse treatments.

Keep good records of all your medical-related expenses. They could help you clear this tax deduction hurdle. Changes made with the enactment of the Affordable Care Act mean that taxpayers age 65 or younger must have qualifying medical expenses in excess of 10% of adjusted gross income in order to deduct them.

And self-employed taxpayers take note. If you are not covered by any other employer-paid plan, for example, one carried by a spouse, you can deduct 100% of health insurance premiums as an adjustment to income in the section at the bottom of Page 1 of Form 1040.


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