CCH Lists Ten Ways to Reduce Your Taxes Whether You Itemize or Not

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March 1, 2010
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CCH Lists Ten Ways to Reduce Your Taxes Whether You Itemize or Not

RIVERWOODS, Ill., March 1 -- You don't have to itemize to find opportunities for savings on your taxes, according to CCH, a Wolters Kluwer business and a leading provider of tax, accounting and audit information, software and services (CCHGroup.com). But be sure to select your tax form carefully and read the instructions thoroughly. Not every deduction or credit appears on every form. While some deductions and credits have their own lines, others do not. You are required to do some hunting and may have to fill in the blanks to take advantage of them.

Here "above the line" deductions are available to non-itemizers and itemizers alike. Numbers 1-4 are available on both Form 1040 and 1040A, 5-10 are available only on Form 1040.

  1. IRA deductions - The maximum deduction per year for an Individual
     Retirement Account (IRA) is $5,000 for 2009. Individuals 50 and older
     can make an additional catch-up contribution of up to $1,000. You can
     still reduce your taxes through an IRA contribution. Contributions made
     up to the return due date, without extensions, are treated as made on
     the last day of 2009.
  2. Student loan interest - If you qualified for and have paid interest on
     qualified education loans, you may claim an above the line deduction
     for the interest, up to $2,500. The deduction starts to phase out for
     individuals with a modified adjusted gross income (AGI) of more than
     $50,000, and more than $100,000 for joint filers.
  3. Tuition and fees - You can take up to $4,000 as an above the line
     deduction for qualifying educational expenses at an accredited
     post-secondary institution. The deduction is subject to reduction at
     AGI levels above $65,000 ($130,000 for joint filers) and is not
     available if AGI exceeds $80,000 ($160,000 for joint filers). This must
     be coordinated with other educational exclusions and cannot be used for
     anyone for whom the American Opportunity Tax Credit or Lifetime
     Learning Credit is claimed.
  4. Teachers' classroom expenses - On 2009 returns, eligible educators can
     deduct up to $250 per year for unreimbursed expenses incurred in
     connection with books, supplies (other than non-athletic supplies for
     courses in health or physical education), computer equipment and
     supplementary materials used in the classroom.
  5. Expenses for reservists, performing artists, fee-basis government
     officials - Normally, expenses related to an occupation are taken as
     itemized deductions or are subtracted from income on a business return,
     but there are exceptions for these narrow classes. See Form 2106 for
     details.
  6. Health Savings Accounts (HSAs) and Archer Medical Savings Accounts
     (MSAs) - The deduction for HSAs is taken on line 25. If you have an
     MSA, you must indicate the deduction by writing in "MSA" and the amount
     on the dotted line next to line 36.
  7. Moving expenses - To qualify, your new workplace must be at least 50
     miles farther from your old home than was your previous workplace.
  8. Deductions for the self-employed - If you're self-employed, you can
     deduct one-half of your self-employment taxes. You also can deduct the
     health insurance premiums you paid as a self-employed individual.
     Self-employed individuals also can deduct their contributions to Keogh,
     SEP and SIMPLE retirement plans from their gross income.
  9. Early withdrawal penalties - If you earned interest that you later
     forfeited because of a premature withdrawal penalty, you can use the
     loss to reduce your gross income.
  10. Alimony - Alimony is deductible, including back alimony, in the year
      when it is actually paid. Amounts that are actually property
      settlements or child support are normally non-deductible - although
      different rules apply to pre-1984 divorces.

  About CCH, a Wolters Kluwer business

CCH, a Wolters Kluwer business (CCHGroup.com) is a leading provider of tax, accounting and audit information, software and services. It has served tax, accounting and business professionals since 1913. CCH is based in Riverwoods, Ill. Wolters Kluwer is a leading global information services and publishing company. Wolters Kluwer is headquartered in Alphen aan den Rijn, the Netherlands (http://www.wolterskluwer.com).

Source: CCH, a Wolters Kluwer business
   

CONTACT:  Neil Allen, +1-847-267-2179, neil.allen@wolterskluwer.com, or
Leslie Bonacum, +1-847-267-7153, mediahelp@cch.com

Web Site:  http://www.cchgroup.com/
http://www.wolterskluwer.com/

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