J.K. Lasser's 1001 deductions and tax breaks, 2016 : your complete guide to everything deductible

Advice on preparing a good tax return answers the question "What can I deduct?" with strategies and ideas to reduce payments to the minimum while keeping in compliance with the law.;1001 DEDUCTIONSAND TAX BREAKS2016; Contents; Introduction; Tax-Favored Items; Limits on Qualifying for Tax-Favored Items; Standard Deduction versus Itemized Deductions; Overall Limit on Itemized Deductions; Impact of Deductions on Your Chances of Being Audited; How to Use This Book; Chapter 1: You and Your Family; Personal Exemption; Dependency Exemption; Child Tax Credit; Dependent Care Expenses; Adoption Costs; Foster Care; Child Support; Alimony; ABLE Accounts; Chapter 2: Medical Expenses; Employer-Provided Health Insurance ; Premium Tax Credit; Health Coverage Tax Credit. 1001 DEDUCTIONSAND TAX BREAKS2016 3 Contents 7 Introduction 9 Tax-Favored Items 11 Limits on Qualifying for Tax-Favored Items 11 Standard Deduction versus Itemized Deductions 13 Overall Limit on Itemized Deductions 14 Impact of Deductions on Your Chances of Being Audited 15 How to Use This Book 15 Chapter 1: You and Your Family 17 Personal Exemption 18 Dependency Exemption 20 Child Tax Credit 25 Dependent Care Expenses 31 Adoption Costs 36 Foster Care 39 Child Support 40 Alimony 42 ABLE Accounts 44 Chapter 2: Medical Expenses 45 Employer-Provided Health Insurance 46 Premium Tax Credit 47 Health Coverage Tax Credit 50 Itemized Medical Expenses 53 Self-Employed Health Insurance Deduction 61 Long-Term Care Coverage 62 Flexible Spending Arrangements for Health Care 65 H ealth Reimbursement Arrangements 67 Health Savings Accounts 69 ABLE Accounts 77 COBRA Coverage 78 Medicare 80 Continuing Care Facilities and Nursing Homes 82 Accelerated Death Benefits 84 Decedent’s Final Illness 85 Medical Insurance Rebates 87 Chapter 3: Education Costs 89 Employer-Paid Courses 90 Scholarships, Fellowships, and Grants 92 American Opportunity Credit 93 Lifetime Learning Credit 98 Job-Related Education 99 Tuition and Fees Deduction 102 Student Loan Interest 105 Interest on U.S. Savings Bonds 108 Coverdell Education Savings Accounts 110 Qualified Tuition Programs (529 Plans) 116 ABLE Accounts 120 Seminars 120 Educational Travel 120 Cancellation of a Student Loan 121 Penalty-Free Withdrawals from IRAs 122 Government Reimbursements 123 Chapter 4: Your Home 124 Mortgages 125 Mortgage Interest Tax Credit 128 Home Equity Loans 131 Points 132 Refinancing 135 Prepayment Penalties 137 Late Payment Penalties 138 Mortgage Insurance 140 Reverse Mortgages 141 Cancellation of Mortgage Debt 142 Penalty-Free IRA Withdrawals for Home-Buying Expenses 143 Real Estate Taxes 144 Cooperative Housing 146 Minister’s Housing Allowance 147 Home Sale Exclusion 149 Moving Expenses 154 Energy Improvements 158 ABLE Accounts 161 Chapter 5: Retirement Savings 162 Traditional IRAs 163 Roth IRAs 170 IRA Rollovers 175 MyRAs 178 401(k) and Similar Plans 179 Self-Employed Retirement Plans 182 SEPs 185 SIMPLEs 187 Retirement Saver’s Credit 190 Custodial/Trustee Fees 194 Employer-Paid Retirement Planning Advice 195 Charitable Transfers of IRA Distributions 196 Loans from Retirement Plans 196 Chapter 6: Charitable Giving 197 Cash Donations 198 Appreciated Property Donations 203 Used Clothing and Car Donations 208 Intellectual Property Donations 210 Real Estate Donated for Conservation Purposes 211 Bargain Sales 213 Volunteer Expenses 215 Tickets to Fund-Raisers, Raffles, and Sporting Events 216 Membership Fees to Nonprofit Organizations 218 Student Exchange Program 219 Donor-Advised Funds 220 Appraisal Fees and Other Costs 221 IRA Transfers to Charity 222 Record Keeper for Your Charitable Giving 223 Chapter 7: Your Car 224 Business Use of Your Personal Car 225 Employer-Provided Car 230 Vehicle Registration Fees 233 Car Accidents and Other Car-Related Problems 234 Donating Your Car 237 Credit for Electric Drive Vehicles 237 Chapter 8: Investing 240 Penalty on Early Withdrawal of Savings 241 Loss on Bank Deposits 242 Capital Losses 246 Capital Gains and Qualified Dividends 249 Worthless Securities 250 Loss on Section 1244 Stock 253 Margin Interest and Other Investment-Related Borrowing 255 Safe-Deposit Box Rental Fee 257 Subscriptions to Investment Newsletters and Online Services 258 Home Computer Used for Investments 259 Fees for Financial Advice 261 Amortization of Bond Premium 262 Municipal Bonds 264 Savings Bonds 266 Gain on the Sale of Small Business Stock 267 Gain on Empowerment Zone Assets 270 Foreign Taxes on Investments 271 Exercise of Incentive Stock Options 274 Losses from Investment Ponzi Schemes 275 Chapter 9: Travel 277 Business Travel 278 Temporary Work Assignments 283 Conventions 286 Medical Travel 288 Charitable Travel 290 Moving for Work 291 Educational Travel 291 National Guard and Military Reservist Travel 294 Frequent Flier Miles 295 Recordkeeping for Travel Expenses 296 Chapter 10: Entertainment 298 Meals and Entertainment 299 Company Holiday Parties and Picnics 304 Sporting and Theater Events 305 Home Entertainment 309 Entertainment Facilities and Club Dues 310 Recordkeeping for Meals and Entertainment Expenses 312 Gambling Losses 313 Chapter 11: Real Estate 316 Vacation Home 317 Home Office 322 Timeshares 323 Rentals 329 Low-Income Housing Credit 334 Rehabilitation Credit 335 Deduction for Energy-Efficient Commercial Buildings 338 Conservation Easements 339 Special Breaks for Certain Disaster Victims 339 Chapter 12: Borrowing and Interest 340 Home Mortgage Interest 341 Student Loan Interest 341 Borrowing from Retirement Plans 341 Investment-Related Interest 343 Business Interest 343 Accrued Interest on Bond Purchases 344 Below-Market Loans 346 Bad Debts 348 Debt Forgiveness 352 Chapter 13: Insurance and Catastrophes 354 Casualty and Theft Losses 355 Disaster Losses 362 Disaster Relief Payments 362 Damages 364 Disability Coverage 366 Accelerated Death Benefits 367 Legal Fees 369 Appraisal Fees 369 Damage from Corrosive Drywall 370 Identity Theft 370 Identity Theft and Tax Relief 370 Chapter 14: Your Job 372 Job-Hunting Expenses 373 Dues to Unions and Professional Associations 375 Work Clothes and Uniforms 376 Subscriptions to Professional Journals and Newsletters 379 Work Tools and Equipment 380 Miscellaneous Job-Related Expenses 382 Educator Expenses 384 Home Office Deduction 385 Prizes and Awards 386 Performing Artists 387 State or Local Government Officials Paid on a Fee Basis 388 Repayment of Supplemental Unemployment Benefits 389 Jury Duty Pay Turned Over to Your Employer 391 Impairment-Related Expenses 392 Military Benefits 393 Contributions to State Benefit Programs 395 Fringe Benefits 395 Income Earned Abroad 399 Chapter 15: Your Business 403 Start-Up Costs 404 Equipment Purchases 406 Payment for Services 412 Supplies 414 Gifts 416 Hobby Losses 418 Self-Employment Tax Deduction 420 Home Office Deduction 421 Farming-Related Breaks 421 Domestic Production Activities Deduction 423 Other Business Deductions 425 Business Credits 427 Net Operating Losses 429 Chapter 16: Miscellaneous Items 432 State and Local Income Taxes 433 State and Local Sales Taxes 434 Certain Federal Taxes 436 Tax Refunds 436 Tax Preparation Costs 438 Tax Audits 439 Legal Fees 441 Gifts You Receive 444 Inheritances 446 Life Insurance Proceeds 448 Estate Tax Deduction on Income in Respect of a Decedent 449 Rebates and Discounts 451 Government Benefits 452 Alternative Minimum Tax 455 Appendix A: Items Adjusted Annually for Inflation 457 Appendix B: Checklist of Tax-Free Items 460 Appendix C: Checklist of Nondeductible Items 464 Nondeductible Items 466 Index 469 EULA 478 The essential, straightforward guide to lowering your taxes in 2016. J.K. Lasser's 1001 Deductions and Tax Breaks 2016 is the American taxpayer's guide to paying only what you owe. If April perennially finds you wondering just what you can deduct without incurring the wrath of the IRS, this book is your ticket to a smoother, less stressful tax season. If you're confused about deductions and credits, you will find your answer here. This book covers every deduction and credit available to taxpayers--whether you're qualified to take it, as well as how to actually take it. Clear and concise, this book gets right to the point and skips over irrelevant topics and opaque regulations to give you the information you need to get your taxes done and out the door. No complex tax strategies, no gaming the system, and no questionable tactics--just no-nonsense guidance on the myriad deductions and credits that provide perfectly legal--and potentially substantial-tax savings. Millions of Americans pay too much in taxes every year. Tax laws are confusing, and the threat of audit looms large, but deductions and credits are put in place to help people like you. This book helps you take full advantage of what's out there.-Learn which deductions you, personally, can take -Take full advantage of 2016's new saving opportunities -Understand the tax laws that are relevant to you -Save money on your taxes without fear of an audit Do you have any idea how much extra money you could have in your pocket every April? How much you've overpaid year after year? Put an end to it in 2016. J.K. Lasser's 1001 Deductions and Tax Breaks 2016 clears the confusion surrounding deductions and credits to help you lower your tax bill--legally The essential, straightforward guide to lowering your taxes in 2016 J.K. Lasser's 1001 Deductions and Tax Breaks 2016 is the American taxpayer's guide to paying only what you owe. If April perennially finds you wondering just what you can deduct without incurring the wrath of the IRS, this book is your ticket to a smoother, less stressful tax season. If you're confused about deductions and credits, you will find your answer here. This book covers every deduction and credit available to taxpayers—whether you're qualified to take it, as well as how to actually take it. Clear and concise, this book gets right to the point and skips over irrelevant topics and opaque regulations to give you the information you need to get your taxes done and out the door. No complex tax strategies, no gaming the system, and no questionable tactics—just no-nonsense guidance on the myriad deductions and credits that provide perfectly legal—and potentially substantial—tax savings. Millions of Americans pay too much in taxes every year. Tax laws are confusing, and the threat of audit looms large, but deductions and credits are put in place to help people like you. This book helps you take full advantage of what's out there. Learn which deductions you, personally, can take Take full advantage of 2016's new saving opportunities Understand the tax laws that are relevant to you Save money on your taxes without fear of an audit Do you have any idea how much extra money you could have in your pocket every April? How much you've overpaid year after year? Put an end to it in 2016. J.K. Lasser's 1001 Deductions and Tax Breaks 2016 clears the confusion surrounding deductions and credits to help you lower your tax bill—legally.