Income tax preparation questions

[Kim in TN]

Tax stuff confuses me, so I figured I'd just ask my friends on the DIS.

What is the amount you have to have in deductions? Seems like it was $7500 last year? Or does it very? Is this correct, and it would include, Money spent on prescriptions, doctors, hospitals, mileage to the Dr, contributions, Clothes allowance for work etc?
Help me to understand if this is correct and if more along these lines are included, I don't want to spend hours putting all this together to have tax preparer say its not enough like last year.

Thanks!!

 

[Feralpeg]

When deducting medical expenses, it has to be a certain percentage of your income to count. You can't claim what insurance has paid. I have never been able to deduct medical in all the years I've paid taxes. I think the only people who can do so must have incredible health care costs.

You can deduct work expenses to some extent. I don't think you can deduct clothing for work unless it is some special type that your employer required and would not pay for. Normal business clothing is not deductible.

You can definately deduct contributions (both cash and goods). You can deduct home interest paid, presonal property tax, etc.)

I am certainly not a tax expert, but that is my recollection.

 

[tar heel]

Medical expenses and other deductions are sort of like apples and oranges . . .

Charitable contributions, mortgage interest, state and local taxes are all deductible.

Medical expenses MAY be deductible, but are not for most of us. For medical expeneses, you can't start deducting them until they reach 7.5 % of your income. If your income is $100,000, it would indeed be the $7,500 you mentioned. You also cannot deduct anything that's been reimbursed by an FSA. Most people with insurance never come close to that percentage fortunately.

I would think special clothes for work would be an "employee business expense." Like medical expenses, you have to meet a threshhold before you can start deducting these. I've never qualified, so I'm not sure what it is -- 2 % maybe.

To make this even more complicated, if you are high income you may no be able to deduct anything. Can't remember the amount, but it's pretty high. There also is a standard deduction, which means you wouldn't itemize all this stuff and would just take a flat deduction. If you have a mortgage and live in a state with an income tax, this would probably be a bad move.

Hope this helps.

 

[tar heel]

I was surprised to see that blue flower in my post! Can't imagine how it got there without me intending it to. I'll leave it since tax talk needs all the beautifying it can get!

 

[Kim in TN]

Thanks for the info!
I had never heard of the clothing expenses but last year H&R Block Preparer asked me if I had receipts for my scrubs and for work shoes, which of course I didnt' have with mevand she told me to save next years receipts


We don't have a mortgage, house is paid Last year they told us we didn't have any claimable sales tax

Thanks again for all the great info... so far sounds like I don't need the tons of receipts except for daycare unless she tells us differently when we go, and that why I asked my knowledgable DIS friends.

 

[tar heel]

Unless you're high income, you DO want those daycare receipts. It's a credit, which is much better than a deduction. If you owe $10,000 in taxes and have a credit of $1,000, you only pay $9,000.

Since Tennessee doesn't have a state income tax (that's still true -- right) and you have no mortgage, you probably claim the standard deduction. I'm going to guess that's what your tax preparer was talking about instead of the medical thing.

 

[Kim in TN]

Last year was the first year to claim our adopted son, and we had tons of medical from his testing etc and a hospital visit. We don't come close to making $100,000 So I don't know where my figure came from unless the figure had something to do with is adoption and the adoption tax credit etc.

I thought the flower was cute, I agree we all need some flowers in our tax endevours

Again thanks for all your help!!