Members of the National Guard or military reserves, Thank You for your service. You may be able to write off the cost of travel to drills or meetings. If you travel more than 100 miles from home and are away from home overnight, then you qualify. You can deduct the cost of lodging and half the cost of your meals.
Additionally, you receive an allowance for driving your own car to get to and from drills. For 2019 travel, the rate is 58 cents per mile, plus what you paid for parking fees and tolls. This is a deduction you may claim even if you use the standard deduction rather than itemizing.
Businesses owners who continue to work after qualifying for Medicare can deduct the premiums they pay for Medicare Part B and Part D, plus the cost of supplemental Medicare (medigap) policies or the cost of a Medicare Advantage plan.
This deduction is available to you even if you don’t itemize. The deduction is not subject to the 10% of AGI test that applies to itemized medical expenses in 2019. There are exceptions: You can’t claim this deduction for premiums paid for any month that you were eligible to be covered under an employer-subsidized health plan offered by either your employer (if you have a job as well as your business) or your spouse’s employer (if he or she has a job that offers family medical coverage).
While you work what you pay for child care can qualify for a tax credit, worth between 20% and 35%, for a child under the age of 13. It would be a good idea to ask your employer if they offer a child care reimbursement account. This would allow you to pay for the child care with pretax dollars. You can’t use this account to qualify for the tax credit but this may be an even better deal than the tax credit. As an example, if you qualify for a 20% credit but are in the 24% tax bracket the pre-tax reimbursement account is your best option. Payments made through a reimbursement account avoid federal income taxes. You also avoid the 7.65% federal payroll tax with this plan.
A maximum of $5,000 in expenses can be paid through a pre-tax reimbursement account. If you have two or more children, you may qualify for the tax credit up to $6,000 for child care. So if you spend even more for work-related child care than the $5000 maximum reimbursement amount allowed, you can claim the credit on as much as $1,000 of additional expenses. This will save you at least $200.
If you owed state income tax for 2018, be sure to include the amount you paid in your state-tax deduction on your 2019 federal return. This is in addition to state income taxes withheld from your paychecks or paid via quarterly estimated payments during the year.
Just remember that the new tax law limits the deduction for state income, sales and property taxes, combined, to $10,000 a year ($5,000 if married filing separately).
If you received a state income tax refund, there’s a line on the Federal tax form for reporting it. Most people who get refunds can simply ignore it, even if your state sent a 1099-G to the Federal government. If you didn’t itemize deductions on your 2018 federal return, the state tax refund is tax-free.
Even if you did itemize, part of it might be tax-free. It’s taxable only to the extent that your deduction of state income taxes the previous year actually saved you money. If you were able to itemize before taking the state tax deduction, then 100% of your refund is non-taxable. But if part of the state tax write-off is what pushed you over the standard deduction threshold, then part of the refund is tax-free.
If you have been called to serve jury duty, remember, the IRS demands that you report jury duty fees as taxable income. Your employer may continue to pay your full salary while you’re serving on the jury. If the company imposes a quid pro quo: You will have to turn over the jury pay to the company. However, you get to deduct the amount you give to your employer on your tax return.