This year, you have to file your taxes by July 15, 2020 — three months after their typical April due date.
Perhaps you’ve begun to prepare your paperwork and realized that your payment is a bit higher than expected this year. Or, you might just want to save a few dollars amid a pandemic pinch. Either way, you want to lower the amount you’ll eventually send to the IRS.
Luckily, you have tax loopholes on your side. These are perfectly legal hidden tax deductions that many people overlook. But listing them on your forms this year could save you cash.
Here are five things can you write off on taxes that you might not have considered:
1. Moving Costs
Sometimes, getting a new job means you have to move. The IRS is pretty generous in deductions if you’ve done so — you just have to make sure your move fits their parameters.
Your new job has to be at least 50 miles farther from you than your current position, thus lengthening your commute. Let’s say your old office was 25 miles away, but your new one is 75 miles away. If that’s the case, you will meet the first requirement of this deduction.
Secondly, you have to remain employed in the area for 39 weeks out of the next 12 months. This requirement doesn’t stipulate that you stay in the same job, though. So, if things don’t work out with your career after you move, but you remain in your new place and find another full-time job, you can claim the deduction.
Self-employed people can claim the deduction, too, but their requirements are slightly stricter. They have to show that they’ve stayed working in their new location for 74 weeks in 24 months.
With these requirements met, though, you can claim a deduction on a slew of moving expenses. You can get money back for mileage, hotel stays during the move, food, storage and more.
2. Charitable Activities — Not Just Donations
You already know that you can deduct charitable donations from your taxes. What you might not know is that the expenses you’ve paid to participate in philanthropic activities can count, as well.
For example, you might drive 25 miles to reach the food bank where you volunteer to serve dinner. You can claim your mileage on your tax form.
Or, you might have to hire a babysitter so that someone watches your kids while you helm a charity event. This expense counts towards your charitable contributions, too.
If you mentor a child, you can claim all of the money you spend on activities, learning materials and meals together. Even the cost of ingredients to make sweets for a charity bake sale can count on your tax forms.
3. Home Office Expenses
It’s important to note that the IRS is pretty strict about this type of deduction. People got carried away with deducing home-office expenses when, in reality, they worked at their kitchen tables.
However, this deduction could be of particular use to you if you’ve set up a home office — and conduct most of your business there during the pandemic. You can claim your utilities and repair costs, as well as the depreciation of the office property’s value.
Check out the IRS’s website to better understand what counts toward your home office expenses. If you’re doing all of your work at home this year, though, it could be a significant deduction for you to claim in 2020.
4. Pet Expenses
You probably think this could be a gold mine for you — it’s no secret that pets aren’t cheap. However, you can only reduce IRS taxes owed if your pet serves as more than just an adorable companion.
Specifically, you can claim a deduction if you have a service animal. You can deduct any service pet-related expense above 7.5 percent of your adjusted gross income.
Beyond that, you can claim pet expenses if your pets aid in your business in any way. For instance, guard dogs can protect junkyard property. So long as you pay to feed and care for the animals, that can be a tax deduction.
Another woman successfully claimed her pet cats as charitable expenses. She didn’t house the animals for her pleasure and companionship, though. She fostered them until they found their forever homes, so the courts agreed that she did contribute by paying for their food and healthcare.
5. Tax Filing Costs
Let’s say all of the above is Greek to you. You sit down to file your taxes and have no idea how to make necessary claims, let alone deductions for your charitable work or home-office expansion.
You’re in luck in more ways than one. You can purchase software to fill out your taxes for you. Or, you can hire an accountant who will pore over all of your expenses to find all of the things you can write off on taxes.
Either way, once you have paid for such a service, you get another little bonus on your tax filing. Under the “miscellaneous itemized deductions” section of your tax form, you can claim the expense of having someone help you file.
You can only claim these expenses if they are more than 2 percent of your adjusted gross income. Still, it’s a win-win of a deduction if you do breach that benchmark. You get help, you save money, and you save a few dollars for it.
Hidden Tax Deductions — Which Ones Work For You?
These are only a handful of the hidden tax deductions out there to save you money. But they’re great to have in your back pocket as you file. Think back on your year and try to remember how you spent your time and cash.
Then, file your taxes with confidence, knowing you’ve gotten every deductible you’ve earned. And, after that, enjoy your low-cost payment to the IRS — or your healthy return from the government.
It’s going to be a good tax year, thanks to this pretax deductions list.
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