How to Use Tax Deduction Checklists

Use Tax Deduction Checklists

How to Use Tax Deduction Checklists. It's helpful to have a checklist of tax deductions that you can use from year to year. Your checklist can save time at tax preparation time and keep you organized. If you feel an item on your list might raise a red flag to the tax auditors, don't take the deduction.

Step 1

Keep track of the miles you put on your car in the pursuit of your business. Add them and then multiply by the mileage allowance set by the IRS. Keep all your receipts of your expenses.

Step 2

Monitor your receipts for any expenses related to things used in your office. Remember to save any receipts in case you need them for an audit.

Step 3

Keep a list of all bank charges. This includes credit card usage charges and interest.

Step 4

Deduct the amount you pay for health insurance premiums if you are self-employed. Include your medical, life and dental insurance on this deduction.

Step 5

Depreciate whatever items you can. It can save you a lot of money, but you must check with a tax professional. He knows how to get the best deductions.

Step 6

If you hire professionals such as tax accountants, consultants or lawyers to run your business, their fees are deductible. They can find enough tax savings to pay their fees in many cases.

Step 7

Consult with your tax accountant to make sure you have all the items you need for your particular circumstance and state. Also make sure the items on your tax-deduction list are current.