1.
Taxes fluctuate due to three areas – income, filing status and possible tax credits and deductions. Not understanding this leads directly to taxpayers making filing mistakes and not claiming the most commonly overlooked tax breaks. Every year, taxpayers are leaving approximately $1 billion on the table by not claiming all of the tax credits and deductions they qualify to claim.
2.
When thinking taxes, also think “life changes.” That’s because life changes – getting married, having a baby, buying or selling a home, sending a child off to college or retiring – have a large impact on your tax return and bring about tax savings. Whether you visit a tax preparer in-person or use a digital tax preparation product, make sure the service you choose is backed by tax professionals and tax experts and maximizes all of the tax credits and deductions you qualify to claim.
3.
Be aware of commonly overlooked credits and deductions – There have been close to 4,500 changes to the tax code in the past decade. Given the constant changes, it’s no surprise some taxpayers miss out on available tax benefits. Keep these 4 in mind — Wrong filing status — Commonly missed higher education tax breaks –Overlooked Earned Income Tax Credit AND Tax breaks that expired in 2013 – but can still be claimed on your 2013 tax return
4.
There are three Commonly missed higher education tax breaks – The American Opportunity Credit which was extended through 2017, allows taxpayers to claim $2,500 for the first four years of college education for each student. In 2010, more than 2 million taxpayers took advantage of this tax break. The Tuition and Fees Deduction (which expired on Dec. 31, 2013 – but still can be claimed on 2013 returns) provides a reduction in taxable income of up to $4,000 per tax return and finally the Lifetime Learning Credit which is worth up to $2,000 per return for post-secondary degree programs.
