Take Charge of Your Income Taxes

Be prepared for your taxes with our guide to understanding tax forms, the lingo, tax credits and our tips for finding deductions that can save you money.

Benefits of Itemized Deductions

Do to the math! See if itemized deductions will save you more money on taxes.

Add up your deductions

Mortgage interest: Deduct the total interest you paid on your home last year.

Property taxes: All property taxes are deductible.

Interest on a home-equity loan or line of credit: Deduct interest paid on your home loan.

Medical and dental bills: Unreimbursed medical and dental expenses that total more than 7.5 percent of your AGI are deductible. (For example, if your AGI is $30,000, deduct the amount spent that’s greater than $2,250.)

Sales tax or state and local taxes: Choose the larger amount here. Either deduct the sales tax you spent on various purchases last year or what you paid in state and local taxes. (Check your previous return.)

Employment expenses: Deduct money spent for your job that your employer didn’t reimburse and expenses relating to a job search (copies, mailing costs, travel).

Tax-preparation costs: Deduct tax-preparation fees that exceeded 2 percent of your AGI. (If your AGI is $30,000, you can deduct anything above $600.)

Charitable contributions and donations: Deduct all cash contributions and the value of items in good condition donated to a qualifying charity.

Losses from theft, fire or other adversity: If you suffered a sudden loss due to fire, flood, hurricane or theft, you might be able to deduct the loss but you must subtract $500 per incident and 10 percent of your AGI from your total claim.

For more information and specific requirements for these deductions, plus a more complete list of expenses that can be itemized, go to irs.gov/publications/p529.