7 Tax Deductions to Earn You a Bigger Refund

7 Tax Deductions to Earn You a Bigger Refund

There's no reason to pay more than you owe in taxes, but every year, millions of people do just that. Don't leave money on the table because you neglect to claim deductions that could cut your tax bill and earn you a bigger refund check.

Check out these seven commonly-missed tax deductions:

Write Off Your Travel Expenses

Not only can you earn a mileage deduction when you use your car in the course of doing your job, but you can also take deductions for medically-related or charitable travel. For 2009, the deduction for work travel is $0.55 per mile, whereas it's $0.24 per mile for medically-related travel (such as to a doctor’s appointment) and $0.14 per mile for charitable travel (if you volunteer at a nursing home or museum, for example).

Non-Cash Charitable Contributions

In addition to deducting any checks you write to non-profit organizations or religious groups, you can also deduct the value of in-kind contributions. Did you drop off clothes at a homeless shelter? Deduct the value of those clothes. Did you buy a USB stick for your church to use in its office? Every little bit counts. Click here for how to save receipts for tax purposes.

Moving Expenses

If you moved to take a job that is 50 miles or more away from where you lived before, then your expenses for that move are tax-deductible. That includes reasonable moving costs, mileage reimbursement for driving you did during the move, plus lodging while you're en route.

Student Loan Interest—Even if You Weren’t the One Who Paid Off the Loan

Interest you paid on student loans is tax-deductible (if you make less than $75,000, or you and your spouse make less than $150,000). Even if your parents made payments toward your student loan in 2009, you can deduct up to $2,500 of those payments from your own taxes! This is true as long as you're not still a dependent of your parents. Check out the IRS page on student loan interest deductions for more details.

State Sales Tax

Do you live in Florida, Texas, Nevada, Washington, Tennessee, New Hampshire, Wyoming, South Dakota, or Alaska? These states either charge no income tax, or only tax income from interest and dividends. If you live in one of these states, you can deduct your state’s sales taxes instead. And, if you bought a car or boat (or airplane!) during 2009, you can add the sales tax for that purchase on top of the standard deduction for your state. The IRS has established a standard sales tax deduction for all 50 states, but if you live in a state that collects income tax, it probably makes more sense to deduct that instead—and you must choose to deduct either sales or income tax. Calculate your 2009 sales tax deduction.

Child Care

You can receive an actual tax credit (money directly deducted from the taxes you owe—or added to your refund—as opposed to a deduction that you itemize against your taxable income) to help pay for child care. This includes paying for nursery school and summer day camp for the time you're at work or looking for work. You can claim up to $3,000 for one child or $6,000 for two or more. If your employer reimburses you for part of those expenses, you can still claim the credit for the part that isn’t reimbursed. Check out this chart to help you figure out your allowable child care credit.

Tax Preparation Books and Software

If you work with a tax preparer, you can deduct your tax preparation fee. If you go it alone, you can deduct the cost of any tax preparation software or books you buy, and any charges (such as debit card charges) incurred in filing or paying your taxes online.

Happy filing!


Minda is vice president of the American Society of Journalists and Authors and co-author with Bill Pfleging of The Geek Gap.


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