We are often asked whether or not the taxpayer qualifies for itemized deductions. The basic standard deductions are the following:
- Single $6,300
- Married Filing Jointly $12,600
- Head of Household $9,250
- Married Filing Separately $6,300
- Qualifying Widow(er) $12,600
Your itemized deductions would generally take into account the following:
- Home mortgage interest
- State and local income taxes or sales taxes
- Real estate and personal property taxes
- Gifts to charities
- Unreimbursed medical expenses
- Unreimbursed employee business expenses
Generally if the above categories puts you in a position where you itemized deductions are larger than the standard deduction, it is important to itemize. Please call us at 815.842.1112 with any questions.
The IRS has recently published its Tax Tip 2016-15 with emphasis on IRS issues applicable to farmers:
1. Crop insurance counts as income, generally, in the year the insurance payments are received.
2. Farm income averaging: You may be able to average some or all of the current year's farm income by spreading it out over the past three years. This may cut your taxes if your farm income is high in the current year and low in the prior three years.
See Publication 225, Farmer's Tax Guide.
Please call Caughey, Legner & Freehill for your tax appointment today!
The IRS offers a Premium Tax Credit (PTC) for certain people who enroll, or whose family member enrolls, in a qualified health plan offered through a Marketplace. In order to claim such credit, the taxpayer must file a Form 8962. Call our office at 815.842.1112 to determine whether you qualify for this credit. We look forward to helping you navigate the complicated tax laws.
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