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How to Use Deductions on a Tax Return

Are other deductions possible when filing my tax return?

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  • Art Auerbach

    Tax Director, Goodman & Company, LLP

    http://www.goodmanco.com/  
     

    Serving clients since 1932, Goodman & Company brings 75 years of knowledge and experience to the demands of today's ever-changing business environment. Throughout the past 75 years, we've never strayed from our mission-to provide each client with personal, high-quality service using the most up-to-date technology and resources.

  • Are other deductions possible when filing my tax return?

    Basic information to prepare an individual income tax return, Form 1040 and the basic schedules. This video is designed for those individuals who want to undertake the preparation of their tax return. There are tips and pointers for those who have attempted this feat in prior years.

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  • Transcripts

    Host: Are other deductions possible when filing my tax returns?

    Arthur Auerbach: Yes there are two more categories. One is casualty losses. If you had a casualty loss, fire, flood, hurricane, storm, damage then its fair value of the property immediately before the casualty less the fair value of the property immediately afterwards, from that number you subtract anything the Insurance company pays you. 10% of your adjusted gross income and a $100, 10% plus $100 and if you have anything left over you have a casualty loss deduction.

    The next category is miscellaneous itemized deductions. So I am W2 employee. I incur expenses on behalf of my employer that I don't get reimbursed for or can't get reimbursed for. I add all of those expenses up, I put those on form 2106 that could become a miscellaneous deduction. If I had tax preparation fees from a prior year, that's a miscellaneous deduction as well. Union dues. If I am a W2 employee and have to buy my own uniforms, that's a miscellaneous deduction. So there are various categories or items that go in there. The one thing to remember is they are limited to 2% of your AGI. So you add up all your miscellaneous deductions. You subtract 2% of your adjusted gross income, bottom line on page one. Whatever is left over is miscellaneous deductions for Schedule A. There is one more category and that's called gambling losses. So if you are a frequent buyer of lottery tickets or you buy Raphael tickets from people selling the Raphael tickets, or you are a visitor to one of the myriad of casinos or crew or ships that are around or you frequent Native American reservations and gamble money.

    Gambling losses show up on Schedule A but only to the extent of gambling winnings. There is a limit. So, no matter, how much you spend for lottery tickets, if you didn't win anything you have no deduction. If the Church is running a Raphael, that's not a charitable contribution, that's a game of chance, that's gambling. So unless you have gambling winnings, that's not a deduction. It's not a charitable contribution nor is it a gambling loss.

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