What does it mean to itemize your tax return?

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What does it mean to itemize your tax return?

Itemizing means you itemize your deduction based on a few deductions you may pay throughout the year. Being able to itemize usually means you own a home, but there are special occasions when you can itemize if you rent or have other living agreements (i.e. having substantial employee business expenses from your job).

The deductions that you will be able to itemize are:

  • Medical Deductions
    These are limited to 10% of your AGI

    • Copays, prescriptions, mileage, etc.
  • Taxes paid
    • State Income Tax, Real Estate Tax, Vehicle Tax, Town Fire Tax NOT Sewer/Water Tax
  • Mortgage Interest
    • Private Mortgage Insurance (PMI), Points
  • Charitable Giving
    • Church tithings
    • Cash is given to 501(c)(3) non-profit organizations
    • Non-cash donations to non-profits (Salvation Army, Goodwill, donating a vehicle)
  • Job Expenses and Certain Miscellaneous Deductions
    These are limited to 2% of your AGI

    • Expenses of an employee that are unreimbursed by their employer
      • Mileage, Training, Meals, Travel, Supplies, Union Dues
    • Job Search expenses
      • Mileage, Training, Meals, Travel, Supplies
    • Miscellaneous
      • Tax Preparation fees
      • Investment Fees
      • Safe Deposit Box Fees
  • Gambling Losses
    • Equally to the amount of winnings if there are losses.

Of course, this is a summary of itemized deductions. Please if you have additional question Submit a Ticket or give us a call.

By |July 14th, 2016|Comments Off on What does it mean to itemize your tax return?

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