No one wants to pay more in taxes than they have to. Fortunately, numerous deductions and credits can help lower your final tax bill.
However, don’t make the mistake of trying to claim one of the following 14 things. Why? Some of these deductions were wiped out by the Tax Cuts and Jobs Act of 2017. Others were never real deductions in the first place, or are not real deductions unless you closely follow certain rules.
Claiming the following “deductions” could come back to haunt you if you are audited.
1. Unreimbursed work expenses
Until this year, you could deduct a whole slew of miscellaneous expenses to the extent that they exceeded 2 percent of your adjusted gross income. This included unreimbursed work expenses.
Starting with returns filed in 2019 for the 2018 tax year, you can no longer deduct the cost of uniforms, union dues or business-related meals or entertainment, says IRS Publication 5307, which details how that 2017 tax reform legislation impacts individual taxpayers’ 2018 returns.
Wondering which deductions are OK to claim? Good tax software helps — check out “The 5 Best Tax Software Programs for 2019.”
2. Travel expenses for work
If you travel on your own dime for work, it may be time to sit down with your boss and negotiate some reimbursement.
That’s because deducting the cost of business-related travel from your taxes is no longer allowed.
Worth remembering: Mileage for commuting to and from work is not now and never has never been an allowed deduction.
For up-to-date tips, read “Tax Hacks 2019: Did You Miss These 7 Credits and Deductions?”
3. Home insurance
The federal government kindly allows deductions for some costs of homeownership — but by no means all of them.
Homeowners insurance, for example, is not deductible except as a business expense if you own a rental property.
You can write off some of your homeowners insurance costs only if you have a home office. We’ll get to that in a minute.
4. Interest on a home equity loan
The rules for deducting interest on a home equity loan have changed.
According to the IRS, “interest paid on most home equity loans is not deductible unless the loan proceeds were used to buy, build, or substantially improve your main home or second home.”
5. State and local taxes over $10,000
The ability to deduct state and local taxes has historically been a major benefit for taxpayers in many states.
But the Tax Cuts and Jobs Act of 2017 chopped that deduction off at the knees.
Married couples filing jointly and single filers now can deduct only $10,000 — or $5,000 if married and filing separately — of taxes paid to state and local governments.
That may seem like a lot if you live in a low-tax region, but it’s a significant loss for taxpayers in states like California and New York, where property taxes can be high.
6. The kitchen counter that doubles as a work desk
If you’re self-employed or own a business, you can claim a home office deduction on Schedule C. Indeed, that is a legitimate deduction.
Schedule C lets you deduct a portion of your homeowners insurance, utilities, homeowner association fees and other home costs from your taxes.
However, you can turn this legitimate deduction into something phony by stretching the rules to their breaking point — and beyond: “Simply doing some work at the dining room table isn’t enough to qualify. You must use part of your home as your principal place of business, and use it exclusively for that purpose,” according to Money Talks News founder Stacy Johnson.
So, your “home office” cannot include the kitchen counter where you set up your laptop in the morning and chop vegetables in the evening. It also can’t be the desk that you use for work and the kids use for homework.
7. Losses from a house fire
Until the 2018 tax year, if your uninsured house burned or the insurance company refused to cover damage from a flood, hurricane, earthquake or other disaster, vandalism, theft or accident, you might have been able to write off your losses on your taxes.
No longer. Now, only those who living in a federally designated disaster area may deduct these losses, according to tax and accounting firm Thompson Greenspon.
8. Cosmetic surgery
Cosmetic surgery may be a medical cost, but you can’t deduct cosmetic surgery on your income tax forms.
There’s an exception, however, if it “was necessary to improve a deformity related to a congenital abnormality, an injury from an accident or trauma or a disfiguring disease.”
9. A doctor-ordered vacation
Even if your physician says a week in the Bahamas would be good for your health, you can’t deduct it from your taxes. Since that’s spelled out specifically in the Schedule A instructions as nondeductible, so you can bet that someone tried writing off their doctor-ordered vacation.
10. Funeral costs
Costs for a funeral, burial, cremation or other associated death expenses may not be deducted from income on an individual’s income tax.
Funeral expenses are never deductible from income for income tax purposes, whether it is an individual who paid them or an estate.
Some funeral costs may be deductible when paying inheritance tax or estate tax, The Balance adds. A tax specialist can help you determine which expenses qualify.
11. Moving expenses
Moving expenses are no longer deductible, according to IRS Publication 5307. This deduction, too, was a victim of the tax reform law.
The only exception is for active-duty military members who relocate because of a new assignment.
12. Volunteer hours for charity
The IRS allows for the deduction of costs of operating a car for charitable purposes — currently, to the tune of 14 cents per mile. But the government doesn’t recognize donations of your time and talent as deductible.
13. Political contributions
Writing off contributions to political candidates and organizations is a no-no.
These groups are not charities, and so your contributions don’t qualify for a deduction.
14. Baby sitter for your date night
True, there is a child and dependent care credit. But not all child care expenses qualify.
You may claim the credit only for care that occurred in order for you to work or actively look for work — assuming that you meet the other requirements of the credit.
That means deducting the baby sitter for your date night if off-limits, even if that cost helps you remain sane enough to get back to work on Monday.
What’s your take on how deductions have changed since the passage of tax reform? Sound off below or on our Facebook page.
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