Here's 7 tax deductions you might not know about

Tax Season Begins
Posted at 9:44 AM, Mar 17, 2022
and last updated 2022-03-17 09:44:08-04

(WXYZ) — Monday, April 18th is "Tax Day." That's just a little over four weeks away.

But you might not know about some deductions.

Cathy Lorenz, a partner and CPA with Cohen & Company in St. Clair Shores says there are two types of deductions: itemized deductions and above-the-line deductions.

Above-the-line deductions are for anybody eligible.

Even if you don't have enough itemized deductions and you'd rather take the standard deduction, you still can take things like educator expenses," Cathy said.

An example of an itemized expense is educator expenses.

"Teachers can take up to $250 dollars for classroom supplies," Cathy said.

Also if you're self-employed, Cathy says you can deduct your self-employed health insurance which includes medicare.

"So, if you've retired, you're on social security, but you're working a side job, you can take your Medicare and other health insurance expenses above the line," she said.

Student loan interest you paid last year can also be claimed as an adjustment to income so no need to itemize that.

If you suffered from June's flooding losses last year, the federal government declared that a disaster so victims can claim a casualty loss deduction without itemizing.

"People in Michigan that had more than $500 in unreimbursed losses for property and things like that that were in their basement, they can take that deduction," Cathy said.

Lorenz says itemized deductions people may not be aware of include medical expenses, home equity loan interest, and gambling losses.

Those who claim gambling losses up to the limit of their winnings on their federal tax return can now make that deduction on their state form.

This deduction is also good for lottery tickets.

Every time you buy one, just keep it in a bag for your tax records.

If you're not sure if you should itemize, consult with a reputable tax preparer.