Deductions are probably the topic of greatest interest for all citizens and residents, we know that they will allow us to reduce certain expenses and income of the final return, it is synonymous with fiscal benefit. You should be aware that you can choose between the standard return or itemize deductions (the one that represents the highest amount).

If you do not know how to do it, remember that we can guide you to avoid making mistakes that may be detrimental to you.

Third Section Deductions.

In case you do not opt for the standard deduction (single or married filing separately $12,950; married filing jointly $25,900; head of household $19,400), you can itemize deductions, if applicable, you should have on hand:

• Medical expenses paid.
• Health insurance premiums.
• Form 1098 showing mortgage interest, mortgage insurance premiums, and property taxes you paid during the 2022 tax year.
• Real estate taxes.
• State and local income or sales taxes.
• Taxes paid on the registration of your vehicle. 
• Charitable donations.
• Documentation of casualty losses (if you lived or owned property in a declared disaster area).
• If you have any of the following deductions, known as Adjustments to Income, you can claim them even without itemizing:
• Form 1098-E for student loan interest.
• Records of contributions to an HSA, IRA, SEP or self-employed retirement plan.
• Alimony paid (for divorce or separation agreements dated before December 31, 2019).
• For teachers, expenses paid for classroom supplies.
• Premiums paid for self-employed health insurance.

Fourth Section. Tax Credits.

In order to claim tax credits, the following documentation is required:

• Form 1098-T with higher education expenses.
• Child care expenses, caregiver’s name, address and tax identification number.
• Adoption expenses and Social Security number of the child who was legally adopted during 2022.
• Form 1095-A if you purchase health insurance through the Obamacare Marketplace.
• Personal tax credits you may qualify to claim on your tax return:
• American Opportunity Credit: A credit designed to offset the costs of attending the first 4 years of college.
• Lifetime Learning Credit: A credit designed to offset the costs of pursuing higher education.
• Health Insurance Premium Tax Credit (refundable): A credit designed to offset the costs of health insurance premiums purchased through an affordable insurance exchange.
• Adoption credit (nonrefundable): A credit to offset the costs of adopting a child.
• Earned income credit (refundable): A credit designed to offset the costs of living expenses for low-income households.
• Child tax credit (refundable): A credit designed to offset the costs of raising children.
• Child and Dependent Care Credit: A credit designed to offset child care costs while working or looking for work.
• Foreign tax credit (nonrefundable): A credit designed to offset taxes paid on foreign income.
• Savings credit (nonrefundable): A credit designed to encourage low-income taxpayers to save for their earnings.
• Credit for Excess Social Security and RRTA Withholding (refundable): A credit designed to offset additional payroll taxes deducted from an employee who works for multiple employers.

Fifth Section. Estimated tax payments.

Applies if you are self-employed, have high income or your income does not have federal and state income tax withholding, you must include those estimates on your tax return, so you don’t pay twice:

• Estimated tax payments made during 2022 to the IRS and state and local taxing authorities.
• Refunds from prior years applied to the current year Any amount paid with an extension.

April 17, 2023 is the default deadline to file the corresponding returns, remember to gather all the above information, depending on your case, and keep the relevant documents in case of an audit by the IRS or the tax authority of your state. They can request everything necessary to support the income and tax deductions filed on your return, not only will you save time, but you will avoid overlooking any unclaimed deductions or credits. 

Do you need help for your tax return? Contact us, you can do it via Whatsapp, email [email protected] or phone call (+1) 786-5770191. Or if you want, you can contact us through our website (here)