Tax Deductions and Credits 5 End of Year Tips to Maximize Your Tax Refund [video] Read the Article Open Share Drawer Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Pinterest (Opens in new window)Click to print (Opens in new window) Written by TurboTaxLisa Published Nov 12, 2014 0 min read It’s not too late to make smart end of year tax moves that save you money come tax-time. Find out a few tricks to maximize your tax refund. Previous Post Happy Veterans’ Day: Tax Breaks for Our Military Next Post End of Year Tax Tips to Maximize Your Tax Refund Written by Lisa Greene-Lewis Lisa has over 20 years of experience in tax preparation. Her success is attributed to being able to interpret tax laws and help clients better understand them. She has held positions as a public auditor, controller, and operations manager. Lisa has appeared on the Steve Harvey Show, the Ellen Show, and major news broadcast to break down tax laws and help taxpayers understand what tax laws mean to them. For Lisa, getting timely and accurate information out to taxpayers to help them keep more of their money is paramount. More from Lisa Greene-Lewis Follow Lisa Greene-Lewis on Twitter. 38 responses to “5 End of Year Tips to Maximize Your Tax Refund [video]” Am I able to deduct the insurance premiums for medical and Dental I pay through payroll deductions for my employer provided insurance? Reply I had 35,000 damage to my house that were from flood waters in this Tax year. This damage was not covered by my homeowners Insurance. Is this tax deductible and were will this question come up while I am doing Turbo Tax? Reply Hi Linda, There are circumstances where you can withdraw from your 401K before reaching the age of 59-1/2 and waive the early withdrawl penalty as follows: – Distributions made because you are totally and permanently disabled. – Distributions made as part of a series of substantially equal periodic payments over your life expectancy or the life expectancies of you and your designated beneficiary. If these distributions are from a qualified plan other than an IRA, you must separate from service with this employer before the payments begin for this exception to apply. – Distributions to the extent you have deductible medical expenses that exceed 10% of your adjusted gross income (7.5% if you or your spouse is 65 or over) whether or not you itemize your deductions for the year. – Distributions made due to an IRS levy of the plan under section 6331. – Distributions that are qualified reservist distributions. Generally, these are distributions made to individuals that are called to active duty for at least 180 days after September 11, 2001. If any of these apply to you, TurboTax asks if you experienced any of these exceptions and will not calculate the penalty on your taxes. Thank you, Lisa Greene-Lewis Reply emptied 401k, hardship, lost job, been unemployed for 3 months+ used to keep my part of household expenses paid…Any tax suggestions or exemptions I have no income coming in. Reply Hi Michelle, You may be eligible to waive the tax penalty for early withdrawl of your 401K if your medical expenses exceeded 10% of your adjusted gross income (7.5% if you are 65 and over), if you had an IRS levy, or if your are permanently disabled. You may also be eligible for the Earned Income Tax Credit as long as you earned some income from working during the year. Also, if you don’t have health insurance you may be exempt from the requirement to purchase health insurance if you experienced hardship. TurboTax will walk you through tax deductions and credits you’re eligible for based on your situation. Thank you, Lisa Greene-Lewis Reply I have a question about claiming my adult child due to him have ALS disease Reply Hi, Yes, you can claim your son if you provide over half of his support. You can also deduct medical expenses you paid for him. TurboTax will walk you through all of these tax deductions and credits you’re eligible for. Thank you, Lisa Greene-Lewis Reply Hi I purchased a home in September. Is this purchase deductible? Reply Hi Johanna, Congratulations! Yes, the amount of mortgage interest you paid on your home loan, property taxes, and any points/loan origination fees you paid will be tax deductible. TurboTax will help you claim these tax deductions. Thank you, Lisa Greene-Lewis Reply Lisa Is it ok to claim property taxes paid for two different years but actually paid in the same year to reduce income? for instance I paid my property taxes for 2013 on Jan 5 2014. I now want to pay my property taxes for 2014 in 2014. Can I add them together and deduct? I am no longer able to itemize and think that this will allow me to do so this year, thoughts? Reply Hi Wendy, Yes, you can claim the property taxes paid for two different years actually paid in one year on your taxes. Your deduction would go by when it was actually paid. Thank you, Lisa Greene-Lewis Reply What about section 179? Reply Jimmy, If you have business income, the Section 179 expense may be a great way to decrease that income for the year. Mary Ellen Reply On a more general question, when are travel expenses for medical reasons deductible? Reply Hi Roy, You can deduct your travel expenses directly related to traveling for medical reasons. You can deduct milaege, air travel, and even up to $50 per night for hotel stays related to travel to get medical care and up to $50 for one person traveling with you. Your medical expenses have to be more than 10% of your adjusted gross income(7.5% if you are 65 or older) and you have to have enough deductions to itemize. TurboTax will guide you through all of this. Thank you, Lisa Greene-Lewis Reply I received a letter from the IRS stating that I needed to amend my tax’s for 2013. The persons I have for dependents were myself, spouse and one child in college that graduated in May. The IRS records show that two tax fillings were done on my sons SS#. I filled claiming him and he apparently also filled. Was I still able to claim him as a dependent or not. Reply Hi Robert, Only one of you can claim the exemption. If you want to deduct what was paid for college you would have to claim him. He could not take the exemption. Thank you, Lisa Greene-Lewis Reply I have a question about airfare and rental car costs to travel to another state for surgery to be performed by our regular specialist. Reply Hi Mike, Yes, you can deduct your air travel and rental care cost to travel for surgery. You can also deduct up to $50 for lodging for you and one person traveling with you. Thank you, Lisa Greene-Lewis Reply Thank you for the reply Lisa. Lisa, I would appreciate some info on deductible gifting to individuals. I am in a position to do a bit of that to my children. I am 83 nears old so it would be an advance on their inheritance. Jack(John) Reply Hi John, You can give up to $14,000 to each child for 2014 without paying taxes on the gift. Thank you, Lisa Greene-Lewis Reply How much can I deduct for each piece of clothing given to Goodwill? Reply Hi Joanne, You can deduct the fair market value, which is what someone would buy the clothing for from a place like Goodwill. You can use TurboTax ItsDeductible https://turbotax.intuit.com/personal-taxes/itsdeductible/ to help you track and accurately value your donated items. It will also transfer your donations to your tax return. Thank you, Lisa Greene-Lewis Reply What is benefit of donating stocks to a charity from IRA account to satisfy RMD? Reply Jimmy, Donating directly from your IRA to a charity will prevent that income from being reported on your tax return, and may lower your taxable Social Security, and increase your medical and miscellaneous itemized deductions. It may also lower the amount on Investment Income Tax you have to pay. Mary Ellen Reply What about the section 179? Reply My husbands business did well this year, but we don’t want to have to pay in too much on taxes…should we purchase a new vehicle that can be useful toward the business and help reduce taxes? Reply can i deduct my medicare insurance premiums? Reply Jerry, Medicare insurance premiums can be included in your medical deduction. Mary Ellen Reply I would like to know if I can file a used truck that I paid cash for as a deduction? How about gas receipts? Reply Janice, if you are in a business, and use the truck for business, you can depreciate the truck, and claim gas, insurance, taxes, interest, and repairs as deductions, or use the standard mileage rate for the miles used for business. You must have a mileage log showing business miles vs. personal miles. TurboTax will help you with the deductions. Mary Ellen Reply HELLO LISA, I AM RETIRED AND CONTINUE TO CONTRIBUTE TO MY I. R. A. WHICH I WILL DO UNTIL I AM 70 1/2 YRS. OLD. BEFORE I BEGIN THE MANDETORY DISTRIBUTION. MY QUESTION IS THIS: IN THE PAST YEARS I HAVE TRIED TO IMPLEMENT MY TAX REDUCTION BY TRYING TO HAVE TURBO TAX RECOGNIZE MY YEARLY CONTRIBUTION TO NO AVAIL. I DO DRAW A PENSION FROM MY STATE OF TEXAS SO COULD THIS BE THE REASON WHY? IF NOT WHAT IS GOING ON? JACK Reply Hi Jack, You can only deduct contributions to a retirement fund if you have earned income like wage or business income. If you are retired and no longer receiving a W-2, you are not eligible to contribute to an IRA. Your pension income does not qualify as earned income. Mary Ellen Reply Just got mail from IRS stating, that I had not filed taxe for 2013?? I have ignored it. Ihad confirmation from turbo tax that my had been accepted. frances adams Reply Frances, Did you check back into TurboTax to confirm your filing? You should have received three email, one that the transmission was accepted by Intuit, then another one stating that the IRS has accepted your return, and one stating that your state has accepted your return. You should never ignore correspondence from the IRS. You may need to print out a copy of the return and mail it in even if your return was filed previously. Mary Ellen Reply i want to draw some emergency cash from my 401k. my birrthday is 01/26/1956. i was told i may be able to waive the early withdrawal penalty. how is this done?. thanks my name is Linda Fisher Reply Linda, When you prepare your tax return, you will include the income from the distribution that is reported to you on form 1099-R. TurboTax will ask if you qualify for an exception to the penalty. If you were 59 1/2 at the time of the withdrawal, you will qualify for an exception. There are other exceptions. You can learn more here – http://www.irs.gov/taxtopics/tc558.html Mary Ellen Reply Leave a ReplyCancel reply Browse Related Articles Self-Employed Meet Moira Tax Planning TurboTax Enables Refund Advance to Taxpayers Investments Tax Benefits of Real Estate Investing Self-Employed Business Tax Checklist: What You’ll Need When Filing Uncategorized What Is Deferred Compensation & How Is It Taxed? Investments How Does an Inherited IRA Work? 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Am I able to deduct the insurance premiums for medical and Dental I pay through payroll deductions for my employer provided insurance? Reply
I had 35,000 damage to my house that were from flood waters in this Tax year. This damage was not covered by my homeowners Insurance. Is this tax deductible and were will this question come up while I am doing Turbo Tax? Reply
Hi Linda, There are circumstances where you can withdraw from your 401K before reaching the age of 59-1/2 and waive the early withdrawl penalty as follows: – Distributions made because you are totally and permanently disabled. – Distributions made as part of a series of substantially equal periodic payments over your life expectancy or the life expectancies of you and your designated beneficiary. If these distributions are from a qualified plan other than an IRA, you must separate from service with this employer before the payments begin for this exception to apply. – Distributions to the extent you have deductible medical expenses that exceed 10% of your adjusted gross income (7.5% if you or your spouse is 65 or over) whether or not you itemize your deductions for the year. – Distributions made due to an IRS levy of the plan under section 6331. – Distributions that are qualified reservist distributions. Generally, these are distributions made to individuals that are called to active duty for at least 180 days after September 11, 2001. If any of these apply to you, TurboTax asks if you experienced any of these exceptions and will not calculate the penalty on your taxes. Thank you, Lisa Greene-Lewis Reply
emptied 401k, hardship, lost job, been unemployed for 3 months+ used to keep my part of household expenses paid…Any tax suggestions or exemptions I have no income coming in. Reply
Hi Michelle, You may be eligible to waive the tax penalty for early withdrawl of your 401K if your medical expenses exceeded 10% of your adjusted gross income (7.5% if you are 65 and over), if you had an IRS levy, or if your are permanently disabled. You may also be eligible for the Earned Income Tax Credit as long as you earned some income from working during the year. Also, if you don’t have health insurance you may be exempt from the requirement to purchase health insurance if you experienced hardship. TurboTax will walk you through tax deductions and credits you’re eligible for based on your situation. Thank you, Lisa Greene-Lewis Reply
Hi, Yes, you can claim your son if you provide over half of his support. You can also deduct medical expenses you paid for him. TurboTax will walk you through all of these tax deductions and credits you’re eligible for. Thank you, Lisa Greene-Lewis Reply
Hi Johanna, Congratulations! Yes, the amount of mortgage interest you paid on your home loan, property taxes, and any points/loan origination fees you paid will be tax deductible. TurboTax will help you claim these tax deductions. Thank you, Lisa Greene-Lewis Reply
Lisa Is it ok to claim property taxes paid for two different years but actually paid in the same year to reduce income? for instance I paid my property taxes for 2013 on Jan 5 2014. I now want to pay my property taxes for 2014 in 2014. Can I add them together and deduct? I am no longer able to itemize and think that this will allow me to do so this year, thoughts? Reply
Hi Wendy, Yes, you can claim the property taxes paid for two different years actually paid in one year on your taxes. Your deduction would go by when it was actually paid. Thank you, Lisa Greene-Lewis Reply
Jimmy, If you have business income, the Section 179 expense may be a great way to decrease that income for the year. Mary Ellen Reply
Hi Roy, You can deduct your travel expenses directly related to traveling for medical reasons. You can deduct milaege, air travel, and even up to $50 per night for hotel stays related to travel to get medical care and up to $50 for one person traveling with you. Your medical expenses have to be more than 10% of your adjusted gross income(7.5% if you are 65 or older) and you have to have enough deductions to itemize. TurboTax will guide you through all of this. Thank you, Lisa Greene-Lewis Reply
I received a letter from the IRS stating that I needed to amend my tax’s for 2013. The persons I have for dependents were myself, spouse and one child in college that graduated in May. The IRS records show that two tax fillings were done on my sons SS#. I filled claiming him and he apparently also filled. Was I still able to claim him as a dependent or not. Reply
Hi Robert, Only one of you can claim the exemption. If you want to deduct what was paid for college you would have to claim him. He could not take the exemption. Thank you, Lisa Greene-Lewis Reply
I have a question about airfare and rental car costs to travel to another state for surgery to be performed by our regular specialist. Reply
Hi Mike, Yes, you can deduct your air travel and rental care cost to travel for surgery. You can also deduct up to $50 for lodging for you and one person traveling with you. Thank you, Lisa Greene-Lewis Reply
Lisa, I would appreciate some info on deductible gifting to individuals. I am in a position to do a bit of that to my children. I am 83 nears old so it would be an advance on their inheritance. Jack(John) Reply
Hi John, You can give up to $14,000 to each child for 2014 without paying taxes on the gift. Thank you, Lisa Greene-Lewis Reply
Hi Joanne, You can deduct the fair market value, which is what someone would buy the clothing for from a place like Goodwill. You can use TurboTax ItsDeductible https://turbotax.intuit.com/personal-taxes/itsdeductible/ to help you track and accurately value your donated items. It will also transfer your donations to your tax return. Thank you, Lisa Greene-Lewis Reply
Jimmy, Donating directly from your IRA to a charity will prevent that income from being reported on your tax return, and may lower your taxable Social Security, and increase your medical and miscellaneous itemized deductions. It may also lower the amount on Investment Income Tax you have to pay. Mary Ellen Reply
My husbands business did well this year, but we don’t want to have to pay in too much on taxes…should we purchase a new vehicle that can be useful toward the business and help reduce taxes? Reply
I would like to know if I can file a used truck that I paid cash for as a deduction? How about gas receipts? Reply
Janice, if you are in a business, and use the truck for business, you can depreciate the truck, and claim gas, insurance, taxes, interest, and repairs as deductions, or use the standard mileage rate for the miles used for business. You must have a mileage log showing business miles vs. personal miles. TurboTax will help you with the deductions. Mary Ellen Reply
HELLO LISA, I AM RETIRED AND CONTINUE TO CONTRIBUTE TO MY I. R. A. WHICH I WILL DO UNTIL I AM 70 1/2 YRS. OLD. BEFORE I BEGIN THE MANDETORY DISTRIBUTION. MY QUESTION IS THIS: IN THE PAST YEARS I HAVE TRIED TO IMPLEMENT MY TAX REDUCTION BY TRYING TO HAVE TURBO TAX RECOGNIZE MY YEARLY CONTRIBUTION TO NO AVAIL. I DO DRAW A PENSION FROM MY STATE OF TEXAS SO COULD THIS BE THE REASON WHY? IF NOT WHAT IS GOING ON? JACK Reply
Hi Jack, You can only deduct contributions to a retirement fund if you have earned income like wage or business income. If you are retired and no longer receiving a W-2, you are not eligible to contribute to an IRA. Your pension income does not qualify as earned income. Mary Ellen Reply
Just got mail from IRS stating, that I had not filed taxe for 2013?? I have ignored it. Ihad confirmation from turbo tax that my had been accepted. frances adams Reply
Frances, Did you check back into TurboTax to confirm your filing? You should have received three email, one that the transmission was accepted by Intuit, then another one stating that the IRS has accepted your return, and one stating that your state has accepted your return. You should never ignore correspondence from the IRS. You may need to print out a copy of the return and mail it in even if your return was filed previously. Mary Ellen Reply
i want to draw some emergency cash from my 401k. my birrthday is 01/26/1956. i was told i may be able to waive the early withdrawal penalty. how is this done?. thanks my name is Linda Fisher Reply
Linda, When you prepare your tax return, you will include the income from the distribution that is reported to you on form 1099-R. TurboTax will ask if you qualify for an exception to the penalty. If you were 59 1/2 at the time of the withdrawal, you will qualify for an exception. There are other exceptions. You can learn more here – http://www.irs.gov/taxtopics/tc558.html Mary Ellen Reply