What Can I Deduct On My Taxes?
No doubt the most common things that you can deduct on your taxes , you probably already know about. Such as, an exemption amount for the taxpayer, the spouse, each child, and any other qualified dependents; mortgage interest paid on your primary residence; and business deductions such as supplies and mileage.
Below I have compiled a list of the most frequently over-looked tax breaks available. Before you submit your next return, check the following list to see if any of these apply to you.
Also, before delving into the allowable tax deductions below, don’t forget to check out these 10 little known ones, click on the red link below…
>>Top 10 Oddball Tax Deductions<<
Now to continue with more detailed information on tax credits and tax deductible expenses that you can use on your tax return…
Equivalent-to-spouse credit – This could be a child (they must have been under 18 for at least part of the tax year), or a qualified relative who lived with and was dependent on them at any time during the year.
Childcare expenses – These are deductible from your income when both spouses (or spouse, in the case of a single parent family) are working or where one spouse is attending school for all or part of the tax year. If both spouses are working, the lower-income earner must claim the deductions. Childcare expenses can include daycare fees, boarding school, hockey school or summer camp fees. Also, lunch time supervision costs are considered child care expenses and can be claimed on your return. This also applies to before and after-school programs.
Medical expenses – If you have non-reimbursed medical expenses, then these can be eligible to be claimed as a non-refundable tax credit. In some cases medical expenses may also be claimed for dependents other than a spouse or common-law partner, you just need to check the tax laws in the country you live in. The eligible expenses for the medical expense credit are quite lengthy. It can include…
- Attendant care for the disabled, and individuals with severe or prolonged mental or physical infirmities.
- Part Time Attendant Care – It is possible that part time attendant care is covered, but usually only up to a certain amount, you’d have to clarify this exact amount with your country’s tax agency.
- If you have a severe respiratory ailment – it is possible that a
- percentage of the cost of an air conditioner would be covered, though there is usually a maximum to this amount.
- If you are an individual confined to a wheelchair – a percentage of the cost of a special wheelchair equipped van could also be deductible. As above, there will be a maximum to this amount.
- Renovating or adapting-a-home expenses – for example, in a case where construction is necessary to provide a disabled individual access to, or to be mobile or functional within that home. A portion of these expenses incurred are deductible.Some medical devices – Includes ones that are necessary to assist with impaired hearing or seeing.
- Expenses incurred for driveway alterations – For example, to enable a mobility-impaired individual to access a vehicle.
- Tutoring services – In cases where individuals have a certified learning or mental impairment, tutoring services for them to have a better standard of life are covered.
- Travel expenses incurred – These would be travel expenses to obtain medical services outside of the vicinity of an individual’s home, to the extent these have not been reimbursed by a health plan, or other source.
- They would have to be deemed as reasonable expenses and ones that were absolutely necessary.
These medical expenses will vary quite a bit from country to country, I just wanted to give you guidelines to go by and then hopefully provide you with a few things that you can deduct on your taxes that you may not have thought about before. Married or common-law couples are allowed to pool their claims together.
Taxpayers claiming medical expenses should be sure to include all receipts with their returns. Just one more thing before I leave the medical expenses, I found out a few very unusual tax deductions that you may want to check out.
Apparently, hair transplants are considered a medical expense since it is generally considered to be beneficial to the patient’s health. This is also true of breast augmentation surgery.
Disability Credits – There is a tax credit available for taxpayers with severe and prolonged mental or physical infirmity. It doesn’t have to be a doctor to attest the disability. An optometrist can verify sight impairment or an audiologist can certify an individual’s hearing loss. A taxpayer’s physical or mental disability can be confirmed by respectively, an occupational therapist or psychologist.
Caregiver Tax Credit – If you are a taxpayer who is over 17 years of age who is providing in-home care of an infirm, dependent relative (including in-laws) who is at least 65 years of age, then can you can be eligible for a tax credit. There is also a tax credit available for caregivers of children under 18 who have severe disabilities that require full-time home care.
Carrying Charges – These would include expenses associated with financing charges and investment expenses, for example the interest on loans for investment purposes, the cost of renting out a safety deposit box, line of credit interest, and fees paid to financial plans and investment advisors to name just a few.
Self Employment Expenses – If you work from home you can claim some self employed tax deductions including a deduction for that part of the home that is used to conduct business activities (your home office, for example). If you own your home you can claim a portion of your mortgage interest, property taxes and capital cost allowance. If you rent your home you can claim a portion of your monthly rent. You are also allowed to include in your deduction a share of the utilities, insurance or home maintenance allotted to the area of the house set aside for business use.
Charitable Contributions - Spouses can pool their contributions to maximize the tax break. Let the spouse with the higher taxable income take advantage of the credit. An important point to remember is that these donations need not be claimed in the tax year they were made, but can be carried forward for up to possibly up to 5 years.
Dog Food For Service Dog – Amazingly this can be deductible if you have a dog that is a service dog. Another unusual incident was when a tax court decided a farmer was allowed to claim cat and dog food because they were outdoor pets meant to keep wildlife away from their blueberries, so they were providing a service for the farmer’s livelihood. I hope this list has been of some help to you and given you some other areas to consider possible legitimate tax deductions , because although we all are obligated to pay our taxes, none of us want to pay too much! As I mentioned before, it is advisable to contact your local revenue agency and request their publications for a complete list.
Below you will see a list of companies in the USA and Canada that hopefully will be of help to you regarding any questions you may have about legal and allowable tax deductions…
- IRS – Frequently Asked Questions
- IRS – Forms and Publications
- Canada Revenue Agency – Guides & Pamphlets
- H & R Block USA
- H & R Block Canada
- World Wide Web Tax – Tax Deduction Questions
Below is a video I found on YouTube that hopefully you will find helpful.
Regards,
Beth Montana
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