- If you itemize your deductions, you can deduct the amount of state and local taxes you paid. If you are a homeowner, you can also deduct the amount you paid in real estate taxes, so be sure to keep copies of all your tax receipts with your important paperwork.
- Taxpayers who purchase a high deductible health plan can open a health savings account and take a tax deduction for the amount they contribute. For 2011, taxpayers can contribute up to $3,050 to an individual health savings account, and up to $6,050 for a plan that provide family coverage. Those 55 and older can also contribute an extra $1,000 to either an individual or a family HSA.
- Workers who contribute to a traditional IRA can take a tax deduction or the amount they contribute. The IRS reviews the contribution limits for IRA accounts each year, but for 2011, you can contribute up to $5,000, plus an extra $1,000 in catch-up contributions if you are at least 50 years of age.
- If you have a mortgage on your home, you can take a deduction for the interest you pay. This deduction is only available if you itemize, so it is important to add up all of your itemized deductions and make sure they exceed the standard deduction available to all taxpayers.
- Giving money to your favorite charity is personally rewarding, but it can be financially rewarding as well. If you itemize your taxes, you can deduct the amount you gave to charity, either cash donations or donations of clothing, household items and other goods. You should get a receipt for any charitable deductions, and that receipt should clearly list the fair market value of the goods you donated.
State and Local Taxes
Health Savings Accounts
IRA
Mortgage Interest
Charitable Contributions
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