There are several tax deductions that you can claim on your income tax return. Knowing which conclusions are available to you and understanding the criteria for claiming them can save you money on your taxes. Here is a list of some of the top personal tax deductions for 2022.
Home Mortgage Interest Deduction
You can deduct the interest you pay on your mortgage loans, as well as any points you paid to acquire a home. The loan must have been used to buy or improve your primary residence to be deductible. Personal assets such as condominiums and mobile homes that are recognized rather than real estate qualify for this deduction.
Student Loan Interest Deduction
You may claim a $2,500 deduction for student debt used to pay for higher education. If you file as a single tax filer or someone else claims an exemption on your behalf, you are not eligible for this benefit. For married couples who file a joint return and both spouses meet the requirements, you can deduct up to $2,500. You cannot claim this deduction if your filing status is married filing separately or head of household.
Business Expense Deduction
You may be able to deduct costs associated with conducting business as long as those expenses were used for work or were required to maintain your business. This deduction is only allowed if you do not operate your business as a corporation. Business expenses must be ordinary and necessary for the success of your industry.
Tuition and Fees Deduction
You can deduct the tuition and fees you pay to enroll in or attend an eligible post-secondary educational institution. You can deduct up to $4,000 for yourself, your spouse or your dependents. Your deduction may be reduced based on your income level.
Health Savings Account Contribution
If you have a high deductible health plan, you can contribute to a tax-free health savings account (HSA). You cannot utilize this benefit if someone else claims an exemption for you on their tax return. There is no deadline for making 2018 contributions, but the total amount given to you may not exceed the maximum allowed for 2022.
Retirement tax deduction
You can deduct 401(k) contributions made through your employer, as well as traditional IRA or Roth IRA contributions. You can also remove any amounts that you contribute to a 403(b), 457(b), or government thrift savings plan through your employer.
Charitable Contributions Deduction
You can deduct contributions made to qualifying charities and other similar organizations. The deadline for making this deduction is the same as making an HSA contribution for 20122. You cannot deduct a donation made by someone else on your behalf.
If you’ve been looking for ways to save money on your taxes, there are a few deductions that may be available and could provide relief. We hope this roundup of the top personal tax deductions has given you some ideas about what might work best for you and your family during these uncertain times.
Remember that while we cannot guarantee any conclusion will result in savings at tax time, it never hurts to do all possible to lower one’s taxable income!