| Over time as you increase your bottom line (Gross | | | | few things about taxes |
| Wages/Profit), taxation continues to gouge out a larger | | | | For the last four years I have also found that most |
| crevasse in the foundation of all your hard work. In | | | | people are afraid to claim deductions for fear of being |
| order to really benefit from having that higher salary, | | | | audited. Roughly there are only about four hundred and |
| you must maximize your tax deductions, which in turn, | | | | ninety-five people audited each year in this country. |
| minimizes your taxable income and that increases your | | | | Try the math on that one. |
| refund. Or lower your tax debt considerably. | | | | With five billion people in the world, there is a very slight |
| As far as tax deductions are concerned, there are | | | | chance for the majority of the population to be audited. |
| some things one needs to know in order to benefit | | | | And just one note for the self-employed and the |
| from this little loophole in the theory of paying taxes. | | | | "under the table" people, if you haven't filed your taxes |
| The short of it is, if you can cover your tax debt by | | | | for the last ten years, you have a higher chance of |
| having a large enough deduction you lower your | | | | being audited. The truth can be a harsh mistress, but if |
| taxable income thus increasing what you get to keep. | | | | you choose to take that path then you have to deal |
| (Or lower what you have to pay) To most business | | | | with the consequences which, means no refund check |
| people this is elementary however, this is not well | | | | and a chance to spend some time in the federal hotel. |
| known to most regular taxpayers. Since we are not | | | | However and I don't want to condone any illegal |
| taught individual taxes in school or even on regular | | | | activity, there can be huge benefits in those methods |
| college levels, most taxpayers file blindly and say | | | | of producing income and not filing your taxes. |
| "Down with taxes!!!". | | | | Just look at Capone or Willie Nelson, that alone shows |
| Ignorance is definitely not bliss when it comes to your | | | | two different sides of getting audited. Capone was |
| taxes. | | | | audited by the Internal Revenue Service for not paying |
| Tax deductions are the difference between the | | | | taxes on services rendered and goods exchanged, |
| independent and the dependent. Keep in mind that all | | | | which is how the government finally indicted him. Willie |
| deductions must be accountable. However, there are | | | | Nelson was audited by the IRS because his |
| many ways to account for deductions ethically and | | | | bookkeeper didn't, (Keep Willie's books that is) so he |
| unethically and you only have to keep receipts for | | | | visited the lovely facilities of the government |
| three years. Now whether you have receipts or not is | | | | correctional system for a short time. Albeit, in a very |
| one of those ethical/unethical issues I mentioned. The | | | | minimum security. |
| unethical methods will not be discussed. I am a | | | | Now that I've belayed everyone's fear of being |
| professional and not obligated to express certain | | | | audited, here is an abridged list of tax deductions that |
| issues regarding unethical tax deductions. Emails are a | | | | individuals or businesses might be able to claim; |
| different thing though. | | | | Medical and Dental Deductions |
| The number one best way to inform your-self about | | | | Visits to the doctor, (the dentist, regular check-ups and |
| your taxes is to go to the IRS website. (Use .gov | | | | hospital/E-room) operations, prescription drugs, medical |
| instead of .com) Then type pub 17 in the search box | | | | and dental insurance expenses, long-term care |
| and no, it's not a cool new bar in your local | | | | expenses, lab/ex-ray, in home care, This category has |
| government building. The Publication 17 is an Individual | | | | sub categories like batteries for hearing aids and even |
| Tax Guide that covers all the basics when it comes to, | | | | air conditioning units per doctors request or advice. |
| you guessed it, paying taxes. The guide can be | | | | Contributions |
| downloaded for free and can take a few minutes | | | | Most any contribution with monetary value (Church, |
| even with the fastest connection, but very much worth | | | | colleges, nonprofit organizations and volunteer work) |
| the time and trouble. The download time is not | | | | can be claimed as a deduction, including Goodwill. The |
| exaggerated due to the fact that it is about 300 pages | | | | tax regs change each year, but for the last four I can |
| long and has to be filed in Adobe reader. | | | | say that one bag of clothing to Goodwill has a Fair |
| If you're downloading things from the internet on a | | | | Market Value of about twenty-five dollars, without |
| regular basis with no problems, just follow all wizard | | | | actual receipts for the clothing. You just have to get a |
| instructions and you'll be fine. If not, get a friend to do it. | | | | receipt from Goodwill when you donate. |
| By all means, spread the word about this good book. | | | | Under the "Taxes" category, real estate tax, property |
| This is also a great site to get nearly all of your tax | | | | tax and even your state income tax can be claimed. |
| questions answered. You can do things from | | | | Interest paid, casualty loses, miscellaneous/employee |
| downloading forms and publications to finding out how | | | | expenses, self-employed business and education |
| to file your taxes, online, for free. (Just click the "E-File" | | | | expenses are other categories under deductions. A full |
| icon, follow the instructions and find a link that suites | | | | list of deductions can be found at the IRS website or |
| your purpose) | | | | at your local tax prep service. |
| However, most free e-file websites require an AGI of | | | | When it comes to having receipts and not having |
| under $50,000 and a standard 1040/1040ez | | | | receipts, everything you purchase with a credit card |
| preparation. (No Deductions/No Dependents) There | | | | can be tracked, so there isn't a need for those |
| are a few sites that allow for one or the other, you | | | | receipts. Receipts are mainly needed for figuring out |
| just have to take your time and look for them. | | | | your deductions. The government requires you to keep |
| To get back to tax deductions and claiming them, | | | | them for proof in case you get audited. I am not going |
| always remember, unless you claim deductions higher | | | | to say any more for fear of incrimination. |
| than your wages, chances are you will not be audited | | | | I can't impress the full weight of getting your hands on |
| for claiming deductions. I worked for a tax preparation | | | | a copy of the Publication 17 and getting to know it well. |
| service for the last four years, (The initials are JH) I | | | | This book alone can answer nearly all of your federal |
| have had my own clients for the last ten or so, and | | | | income tax questions. However, if anybody has any |
| I've prepared my own taxes nearly every time since I | | | | questions feel free to contact me and until next time, |
| started working over twenty years ago. So I know a | | | | thanks and have a great day. |