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Tax deductions, do I even need to bother??

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  • Tax deductions, do I even need to bother??

    going through TurboTax they ask for a bunch of possible things to help identify tax deductions. However, I don’t qualify for things like student loan interest (MAGI too high) and auto registration (SALT limit). Knowing this, do I even need to bother going through the motions on TurboTax only to have it tell me I’m not eligible? I’d rather not go hunting for a number of documents if it means no tax deductions.

    Even though I’m saying “I didn’t pay student loans” and it’s untrue, will the government care if I don’t make mention of it on the taxes?

  • #2
    No one's ever required to take deductions.  If you're certain that itemizing isn't going to net you anything, you can just zero those questions out and settle for the Standard Deduction.

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    • #3




      going through TurboTax they ask for a bunch of possible things to help identify tax deductions. However, I don’t qualify for things like student loan interest (MAGI too high) and auto registration (SALT limit). Knowing this, do I even need to bother going through the motions on TurboTax only to have it tell me I’m not eligible? I’d rather not go hunting for a number of documents if it means no tax deductions.

      Even though I’m saying “I didn’t pay student loans” and it’s untrue, will the government care if I don’t make mention of it on the taxes?
      Click to expand...


      No, just skip it. Honestly, we enter things like student loan interest on the returns even if it's not going to be valid just b/c clients provide the info. Another reason is the SOL. If there is any chance that your return c/b audited and those deductions could turn out to be valid - for example, if you're close to the line - then you want to include them on your return. Otherwise, they are lost if you are beyond the SOL.

      For many clients who ask about medical expenses or the sales tax deduction on a vehicle, we just tell them not to go to the trouble b/c it won't help. If you already know the direction this is going and it's pretty obvious, save yourself some time and skip the data entry.
      Financial planning, investment management and CPA services for physicians, dentists, and medical professionals | 270-247-6087

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      • #4




        No one’s ever required to take deductions.  If you’re certain that itemizing isn’t going to net you anything, you can just zero those questions out and settle for the Standard Deduction.
        Click to expand...


        While not likely here, this is not entirely true.

        There is actual IRS guidance that you must take all available deductions, if to do otherwise would result in you gaining a tax benefit. This was specifically written to apply to the earned income credit, but can apply to other situations affecting other tax deductions, AGIs, MAGIs, employer retirement plan contributions, etc...

        Tax preparers are subject to specific sections of the tax code and IRS regulations to do due diligence to insure that this does not happen. It is one of the most severe sanctions a tax preparer can receive.

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        • #5
          If you know the tax code pretty well, I agree it’s fine to skip things. Keep in mind that there may be differences between the federal and state tax returns. You may take the standard deduction for federal and itemize for state.

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