There are certain payments that you pay that are eligible for a tax deduction but most people overlook them. Here are some of those instances.
For those who are self-employed, your health insurance premium is tax deductible. This includes your medical, dental, and long-term care insurance premium you pay for the whole family. Under the Affordable Care Act, 2014 tax filing for some may cost additional taxes. All individuals are required to carry health insurance and those without may have to pay a penalty.
We all know that we can deduct interest we pay on our mortgage when we file taxes. But, how about points we paid when we bought a new home or refinanced an existing mortgage? Some people pay points to lower their mortgage interest rate. Your cost to pay for points is deductible. However, they are to be spread over the life of the loan.
Deducting state and local taxes you pay get a bit complicated. States such as California and New York allow tax payers to deduct state and local taxes they pay. But not all states allow this. However, sales tax you pay on purchases is deductible for people who live in Florida and Texas. Remember to keep all your purchase receipts.