TAX DEDUCTIONS

It is that time of year again. Now that the ball has dropped on the new year, it’s time to celebrate the beginning of tax season.

In order to help get you organized and prepared for the grueling task of filing your taxes, here are some tax deductions that are often overlooked. By taking advantage of them, you have the potential to save hundreds or thousands of dollars.

By Tara Struyk

Continuing advances in breast cancer treatment may be improving the odds of survival for many cancer patients, but this advanced technology also means that the cost of treating this disease may be higher than ever. Even for those with insurance, the medical bills associated with breast cancer treatment are a significant burden.

Researchers from the Duke University Medical Center and the Dana-Farber Cancer Institute examined the costs and pegged them at about $712 per month, even those with insurance coverage. Fortunately, the IRS does allow cancer patients to deduct their medical expenses, which can help ease some of the financial burden of fighting this disease. Here we’ll take a look at how medical tax deductions work and what breast cancer patients can and can’t claim.

Medical expenses have to take a pretty big bite out of your budget before you can use them to reduce your income tax liability. By the time you add up all the medical expenses you can count, however, including insurance, you may find they take more than enough of a bite to qualify.

How the 7.5 Percent “Floor” Works

When you’ve been unemployed, you need any financial relief you can get. Fortunately, some of that relief may come from Uncle Sam in the form of income taxes saved. Here’s how:

When you earn less, you pay less in taxes. When you’re working, you have withholding taken out of your pay as if you will earn at the same rate all year. However, if you are off work for any significant length of time, it can drastically change how much you owe. That’s because the last dollars you earn are taxed at the highest rates. If you had too much withheld, the IRS may owe you money.

Everyone who files taxes has to face the decision of whether to choose standard or itemized deductions. There are benefits to taking either route depending on how many tax deductions you are able to claim.

The key is to look at your personal financial situation to decide the best route for you. To help you figure it out, let’s explore what itemized deductions are exactly and whether to use them when filing your taxes.

You support your kids financially and get a break on your taxes. If you support your mom, shouldn’t you get a break, too?

You very well may qualify for a tax break even if your parents don’t live with you. Here’s how to decide if you can take a dependency exemption for your mom (or dad).

It’s already the end of the year (where did the time go, right?), which means it’s also time to put together some year-end tax strategies that will help place you in a good financial position for when it’s time to file for the 2010 tax year. There are so many considerations, including how your taxes will be affected if Bush tax cuts expire on Dec. 31, 2010. That’s why it’s good to do your tax planning now.

To help you get started, we will first look at some general year-end tax strategies that would apply according to current tax standards. Then we can zero in on how your taxes might be affected (and what strategies you could consider) if the Bush cuts actually do expire.

Overhauling the tax code is on the minds of lawmakers now that the Bush Tax cuts are set to expire, but while some adjustments are applauded, members of the housing industry are up in arms regarding the proposal to adjust the mortgage interest tax deduction. Being in the middle of an incredibly fragile housing market, proponents of the tax deduction feel that homeowners need as many breaks as possible. In other words, now is not the time to make changes to a successful deduction.

The Tax Overhaul Proposal

It’s no doubt the United States, despite its own quirky complications, can sometimes appear pretty normal in comparison to the things that go on in other countries. Take taxes–even when it comes to the most mundane of topics, our neighbors overseas can come up with hilariously bizarre charges and fines (like Sweden’s Stripper Tax).

But what about here at home? It’s not just the crazy foreigners that are coming up with the strangest taxes. We Americans seem to be just as “creative.” From sales and use to tax deductions, the following is a list of the weirdest, wackiest and downright head-scratching tax laws by state.

Whether you give or receive child support, you may be wondering what the tax consequences of your child support payments are. If you receive child support payments, do they count as taxable income? If you are making child support payments, can you write those off of your taxes?

The answer to both questions is no. Child support payments are not taxable. The parent making the child support payment cannot deduct it from their income, and the parent receiving the payment is not required to declare the payment as income.