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Many honest, hard-working Americans are leaving money on the table each year. To help you with future tax returns (or this year's return for extension filers), we spoke with Jason Jones, partner at Jones & Swallow, LLC, a public accounting firm.
Here are five deductions you should be claiming.
1. Walk-A-Thon and charity events
The cost of goods you donate to bake sales and the pledges you make for walk-a-thons can be claimed as charitable contribution deductions. "Document your costs, save receipts if applicable, and you can claim it on your tax return," Jones said. "Just be sure the charity is a qualified 501(c)(3) organization."
2. Car donations
Selling an old car is a hassle. So donate your car instead. Donating to a local charity is fast and easy. According to Jones, "Donating your car is a simple, stress-free solution to a problem. It also happens to be tax deductible. All you need is a receipt from the charity, showing the charity's EIN# and a statement that no goods or services were provided. Now your lemon is a tax deduction."
Jones does add a word of warning: "I would be cautious of out-of-state charities to avoid fraud. Call the charity's local office to see how they benefit from your car donation and then follow their instructions. It will save you from making a mistake."
Jones specifically recommended the National Kidney Foundation of Utah and Idaho. "They are Utah's longest standing vehicle donation program. The money stays local and provides medical/financial aid to dialysis and transplant patients, funds local medical research, and provides free kidney screenings," he added.
Photo credit: KSL Cars
3. Thrift store donations (non-cash / in-kind contributions)
Most donations made to charity, including donations to stores such as Goodwill, Savers or Deseret Industries, can be claimed on your return "as long as you document the value, get a receipt, and itemize your deductions," Jones says.
4. Moving costs
Those miles you traveled to move for your new job? You can count those, too. "This is something not many people take advantage of. It's available to all taxpayers who move more than 50 miles for a new job, and who work at least 39 weeks during the first 12 months in the new job location. It doesn't matter if you itemize or not, you can claim this," Jones said.
The key is documentation. "With a few documents, you can deduct the transportation and storage costs of your personal goods and effects, and your travel costs (except meals). Moving can be expensive, so it's nice to see some of that come back."
Photo credit: Shutterstock
5. Mileage driven for church and charity events
Did you just cart your church's youth to that bake sale to raise money for cancer research? Do you drive Boy Scout troops to and from activities? If yes, you can claim your mileage as a deduction on your taxes.
"In order to deduct mileage, the group must be a 501(c)(3) charity and you must itemize your deductions," Jones said.
"The government will allow a deduction of 14 cents per mile. It doesn't seem a lot, but when you document how many miles you put into transporting your youth group or Boy Scout troop, the miles add up pretty quick."
Benjamin Franklin said, "Remember that time is money," and most people will agree. Although your time is not deductible, now is the time to start documenting all the costs incurred at bake sales, walkathons, and mileage. So be sure to take advantage of these five deductions on your next tax return.
