The standard deduction provided by the IRS is adjusted each year for inflation. This is not a bad deduction to use if you cannot use any of the information that is provided in the following paragraphs. When you do apply for additional deductions you need to attach the information to Schedule A of Form 1040. This form should not be feared or you should not think that the IRS will be drawn to your tax return to provide additional scrutiny. The bottom line is that the tax laws allow for deductions and if you have the evidence that you incurred these expenses then you should claim these as deductions. It is surprisingly how quickly the deductions can add up over the 12 month period.

Medical expenses can be claimed as a tax deduction if you have spent over 7.5 % of your adjusted gross income. If you have a young family or if you have had a lot of illness these past 12 months, it is more than certain that you have spent more than 7.5% on medical expenses. When you consider that these expenses include doctor’s fees, hospital fees, drug prescriptions and a number of other expenses the bills will really add up over the 12 month period. The interest you pay on your home mortgage is another deduction if this is your first or second home and you use the home as your main residence. If your home has had damage done to it during the year, like a fire, losing the roof during high winds and other similar major damage you can claim anything above 10% of your gross income. This deduction applies as long as the area in which your home is in has not been declared a disaster area by the US Government.

Donations of money or property to a charitable organisation are another tax deduction. When you donate ensure that you get a receipt from the charitable organisation on the value of your donation. State and local taxes may be deductable for taxes that have been applied to you based on the underlying value of your asset. The asset is usually your property or your vehicle. There are also the standard deductibles you should be looking at such as union dues and tax return preparation expenses. The most important action you must do when claiming deductions is to keep all of your receipts. Your receipts are proof of expenditure, and even if the IRS wants to query any deduction you have the proof. This at the end of the day is all the IRS needs.

The environment is something that has become a major front-runner in good, healthy living recently. More and more people are realizing that if we’re going to survive in this world, we have to look after our environment and become more earth-friendly. Luckily, the United States of America and the wonderful government running our country, has given us so many tax deductions for a green living. It is now worth it for us to actually invest into a greener future. No longer are green living options very expensive and out of our reach, with the help of the government, investing into a greener future also means more tax deductions for us at the end of our tax period.

Hybrid cars are the new generation environmentally friendly cars that are currently being mass-produced by Honda and Toyota. Depending on the specific type of car you are buying, you can get a tax break between $250 and $7,500. It is important to speak to your tax consultant or do research online to see what tax breaks you will get for your specific car. Not only will you essentially be saving money on petrol and fuels that have become so costly, you’ll be driving a car that does minimal damage to the environment.

Insulating your home might seem like a silly idea, but the point of insulation is to keep the heat in during winter and keep the heat out during summer, this will lessen your need to heat or cool your home according to the season. This will not only make your life a lot easier, you won’t need to have an air-cooling solution in every room for example, but it will also cut costs on your energy usage during the cold winter months. The government offers a 30% tax credit or up to a $1500 for any insulation done in your home.

The ultimate way to control your energy consumption and going green is by installing solar and wind energy solutions into your home. This way you have ultimate control over how much money you are spending on electricity but mostly, imagine how much you will save the earth by using its natural resources to fuel your home. The wonderful thing about this tax deduction, that it gives you a 30% tax deduction on ANY amount. So there is no upper amount that you are limited to. This tax break is also going to allowed until 2016, so if you don’t have the money to invest in an alternative energy solution right now, you will have the chance for years to come.