U.S. Tax Preparation Worldwide   James Maertin CPA

 
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Tax Guide

IRS Tax Law Changes

Americans Abroad

Capital Gains, Interest and Dividends

Deductions

Dependents

Education Credits, Scholarships

Foreign Bank Reporting

Foreign Nationals

Social Security, Medicare, Self Employment Tax

State Taxes

Tax Deadlines, Extensions, Late Payments, Estimated Tax

Tax Resident, Nonresident, Dual Status

Other Topics

Deductions


Many clients ask me what they can deduct, so I am providing the following lists of possible deductions.  The lists are only meant to give you ideas, or steer you in the right direction.  They are not all-inclusive and not all items are deductible all the time.  Many are subject to limitations, may only apply in certain situations or are governed by other rules.  Please keep careful records and save your receipts for at least 3 years in case of audit.


Schedule A Expenses (Itemized Deductions) as of tax year 2018

State and Local Taxes You Paid (for 2018, the combined limit is $10,000)

 

Interest You Paid

 

Gifts to Charity

 

Medical Expenses

 

Casualty and Theft Losses

 

Business Expenses for Self Employed (Schedule C)

You are allowed to deduct most business expenses in full.  Meals are generally deducted at 50%.

See IRS Publication 535 for more information.  Please note that this and the other links in this section are to 2017 publications.  The 2018 publications are not out yet and some rules are substantially different.

Advertising and Promotion Expenses

Books and Publications

Dues and Fees:

Education and Research

Equipment and Supplies

Home Office

Internet

Meals

 Telephone Charges

Travel and Transportation

Uniforms and Gear

Other

 

Unreimbursed Employee Business Expenses (limited to certain states)

There is no longer a federal itemized deduction for miscellaneous and job related expenses (subject to the 2% of adjusted gross income floor).  However, certain states may still allow these expenses as an itemized deduction on the state return.  They include New York, California, Alabama, Arkansas, Hawaii, Iowa, Minnesota, and Pennsylvania.

 


 

Qualified Medical Expenses

 

Generally, you can only deduct the excess over 7.5% of Adjusted Gross Income (10% starting in 2019), and then only if you can itemize on Schedule A.  This means that if your adjusted gross income was $100,000, you can only deduct the amount of medical expenses you spent over $7,500.   Please also refer to IRS Publication 502:  Medical Expenses.

 

 

 


Expenses You Cannot Deduct

People commonly hope to deduct some of the following expenses, but unfortunately they are not deductible.

Non-Deductible Expenses:

Nondeductible Home Expenses.  Some exceptions for rental properties.

Nondeductible Taxes and Fees.