Newstime

Follow Us On:

Liberty Tax

Last chance to get these tax deductions

After this tax season, several tax deductions are set to disappear – although the old adage “never say never” certainly applies to anything Congress has the power to change.

 

Personal Exemption: The new “Tax Cuts and Jobs Act” has eliminated the personal exemption that taxpayers may claim for themselves and their qualified dependents. Of course few taxpayers would forget to claim their children or others that live in their household as dependents, but you may be able to claim your parents and other relatives as dependents, even if they did not live with you at any time in 2017. To qualify for this exemption, you must have provided over half of that person’s total support for the year, and that person’s total taxable income for 2017 must be less than $4,050.

 

Employee Expenses: If you incurred expenses related to your employment that were not reimbursed by your employer, you may be able to get a tax deduction. This includes things such as education expenses, mileage, travel, uniforms, tools, safety equipment, cell phone fees (only if cell phone is required by employer), professional subscriptions, magazines, and professional organizations. If you work out of your home for your employer’s convenience, you can also take a “business use of the home” deduction.

 

You may also be able to deduct job search expenses, including out-of-town travel for interviews, resume preparation fees, employment agency fees, and mileage as long as the expenses were not related to employment in your current field of employment, or were for your first job.

 

Union dues are also included in this category.

 

The new law left in place the $250 “educator expense” deduction, but 2017 is the last year you will be able to claim expenses that exceed the $250 limit.

 

Certain Miscellaneous Expenses:

  • Tax preparation fees, including the cost of self-preparation software
  • Investment advisory and IRA custodial fees
  • Safe deposit box rental fees

 

The 2% Threshold: There is a “catch” to claim the above listed employee expenses and certain miscellaneous expenses – your tax deduction for the combined total of these expenses is limited to the dollar amount that exceeds 2% of your adjusted gross income.

 

The 2% threshold requirement is what often prevents taxpayers from taking advantage of these deductions. The other factor that limits the use of these deductions is that you will only want to claim these deductions if the total of all of your itemized deductions exceeds the standard deduction for your filing status. If you meet these conditions, this could be your last chance to take advantage of these deductions.