Tax Day is coming up! Senné’s Chief Financial Officer, David H. Keiran, offers some of his best tax tips for 2022.
None of the stimulus payments are taxable.
The IRS already has records of the stimulus payments, so taxpayers who are certain that they received the stimulus payments they were due don’t have to take any additional action. However, if you received a stimulus payment in 2020 and did not receive one in 2021 you should see if you are eligible to claim the recovery rebate on your tax return which would be included in your refund if you qualify.
Itemize expenses on Schedule A.
If you own a home or have excess tax payments and charitable deductions don’t just take the standard deduction if you can itemize deductions. Check your records to see if you have enough expenses to file Schedule A of the 1040 you may be surprised.
Deduct charitable contributions.
Even if you don’t itemize deductions on Schedule A of the 1040, you can get a $300 credit ($600 if married filing jointly) even if you take the standard deduction on your tax return.
Qualify for a home office deduction.
Most of us worked from home in 2021 for obvious reasons. However, to qualify for the home office deduction you must be a partner or self-employed and work from home. Unfortunately, if you work for an employer, receive a regular paycheck and receive a W-2 form at the end of the year you are no longer able to take the home office deduction. The Tax Cuts and Jobs Act 2017, eliminated the deduction for the years 2018 through 2025. However, you may also qualify if you have a side job and also work for an employer.
You may be able to fund an IRA.
Although there are certain restrictions that might apply, you may be able to fund an IRA in 2022 to reduce your taxes from 2021. There are, however, limits to how much you can put in an IRA. For 2021 and 2022, the limits are $6,000 per year, or $7,000 for people 50 or older. You have until the tax-filing deadline of April 18th to fund your IRA for the previous tax year, which gives you extra time to take advantage of this strategy.
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