Every year, millions of taxpayers leave money on the table by missing legitimate deductions. Here are 15 commonly overlooked deductions that could reduce your tax bill significantly.
1. Home Office Deduction
If you use a dedicated space in your home regularly and exclusively for business, you may qualify for the home office deduction. The simplified method allows $5 per square foot up to 300 sq ft.
2. Student Loan Interest
You can deduct up to $2,500 in student loan interest paid, even if you do not itemize. Income phase-outs apply, so check your eligibility.
3. Medical Expenses
Medical expenses exceeding 7.5% of your adjusted gross income are deductible when itemizing. This includes insurance premiums, prescriptions, and qualified medical travel.
4. Charitable Contributions
Beyond cash donations, you can deduct the fair market value of donated clothing, household items, and even mileage driven for volunteer work at 14 cents per mile.
5. State Sales Tax
If you live in a state without income tax, you can deduct state and local sales taxes instead, up to the $10,000 SALT cap.
Consult with a tax professional to ensure you are capturing every deduction you deserve.