When the tax season starts to come around, there are often some myths that resurface year after year regarding the tax deductions. Such myths are, however, only myths and can harm anyone who starts to believe in them. A fair number of people end up believing in these myths opting to not take professional tax preparer help and then ending up on the wrong side of the IRS regulations. Sometimes, people tend to use mythical tax deduction only to have reality come crashing down on them later. Here are the three things to look out for when doing you tax preparation:
1. Medical Expenses Are Tax Deductible
Medical expenses are deductible but only if they are more than 7.5% of your gross income. This is important to note because people usually tend to misconceive that medical expenses aren’t tax deductible. It is, however, important to note that tax deductions are only done on the amount that is greater than the 7.5% limit and not on the whole of it.
2. Mortgage Interest Helps In Decreasing My Tax Bill
This is a myth that holds its roots in reality but it isn’t completely true. There are outlets according to tax law updates that allow you to claim deduction for your loans interest. To avail this opportunity, you must itemize and calculate a total that exceeds your standard amount. This isn’t ideal for those at the end of the loan term because the amount of interest at that moment is considerably less.
3. Diet Program Gets Me Tax Deductions
This myth, to come true, needs a lot of ifs. There are certain weight requirements that need to be met in order to get tax deductions for your diet plan. You need to have been prescribed the plan by a physician and it must be intended to treat a disease. Obesity is considered a disease but it has to be over the 7.5% requirement mentioned above and prescribed by a physician.
Filing your taxes is never a simple task. To help you file your returns efficiently, there are several programs such as Annual Filing Season Program and Annual federal Tax refresher course available.
