Tax Deductions are caused due to various reasons, a few ways due to which an individual or households can reduce tax this year are:
- Medical Expenses
An individual is allowed to deduct the expenses incurred on the prevention or cure of a physical or mental ailment. The amount is adjustable only if it is enlisted and is more than 10 percent of basic income of the individual. Note that the deduction is allowed only if the expenses were made on him/herself and dependents.
- Education Expenses
Although the maximum amount that is allowed to be deducted is variable as per income but expenses on college education is allowed to be deducted. It includes the student loans as well.
- Tax exemption for dependent
These deductions are allowed to be claimed if a family member is dependent on you. For example, if you’re fostering a child, step child, step-sibling, grandchild who are under 19.
- Mortgage interest credit
The interest paid on the mortgage on property of the taxpayers themselves is allowed to be adjusted in deductions from tax.