Before you file your taxes this year, take a look at this article to see what expenses you’ve incurred that are NOT tax-deductible.
10. Commuting Costs
Believe it or not, the cost of commuting to and from work is not tax-deductible and is, in fact, considered a personal expense. This holds true even if you have to travel very far to get to your job. But, like every other rule, there are always exceptions.
For example, if you work at two places in one day– even if for the same employer– you might be able to deduct some commuting costs. Also, if you have a temporary job expected to last one year or less, you can deduct transportation expenses to and from work.
If you work from home, you can deduct transportation expenses for going to another work location in the same trade or business. Lastly, you can deduct transportation expenses when driving to a client site or a meeting.
9. Cost of Work Wardrobe
Unless you wear a uniform on the job, you cannot deduct your work wardrobe’s cost. One TV anchorwoman tried to do just that some years ago, deducting things like makeup, haircuts, manicures, teeth whitening and contact lenses used to help her read the teleprompter.
But, a judge rejected her efforts in a U.S. Tax Court, ruling that many of the items the woman deducted were personal, not business. The judge also stated that she had to wear them as a condition of her employment, and the clothes could not be suitable for everyday wear for her to deduct the costs of her work clothes.
8. Social Security Taxes
You cannot deduct Social Security taxes when filing your income tax return. Why? Well, the Federal Insurance Contributions Act, or FICA, is what funds your Social Security benefits. Unfortunately, FICA taxes are not deductible.
If, however, you had more than one employer during the taxable year and your total earnings were over the wage base limit for the year, you likely overpaid FICA taxes. If that is the case, you may be entitled to a refund or tax credit.
7. Donations That Weren’t in Good Condition When You Gave Them
If you thought you could donate anything old thing and deduct those items from your taxes, you might want to think again.
According to a Consumer Reports article, the IRS aims to end junk donations by forbidding the donation of furniture, clothing and other household goods that weren’t in good condition when they were given away.
There is an exception to this rule, however. According to IRS.gov, “you can take a deduction for a contribution of an item of clothing or a household item that isn’t in good used condition or better if you deduct more than $500 for it, and include a qualified appraisal prepared by a qualified appraiser and a completed Form 8283, Section B.”
6. Extravagant Gifts
If you are a small business owner, the last thing you want to do is to try to deduct the cost of extravagant gifts you send to customers. Why? Well, because there’s actually a limit on how much you can deduct per customer– $25 to be exact.
That being said, if you want to be able to deduct the whole amount of the gift, opt for something not so extravagant, like some flowers or a fruit basket. Otherwise, know that you won’t be compensated for any amount that goes over $25.
5. Over-the-Counter Medications
Most over-the-counter medications, for example, Tylenol and Theraflu, are not tax-deductible. Prescription drugs, on the other hand, are tax-deductible… which leads to the next point.
If a doctor has prescribed an over-the-counter medication, then, yes, it is tax-deductible. So are over-the-counter pregnancy and blood-sugar level testing kits, as are breast-feeding supplies, including bottles and pumps.
DID YOU KNOW?
Insulin is not technically viewed as a prescription drug. That’s because you can actually get it– at least one form of it anyway– without a prescription.
Human Insulin can be purchased without showing a pharmacist a prescription, although you still need to get it from a pharmacist. Don’t worry, all forms of insulin are tax-deductible.
4. Plastic Surgery
Plastic surgery done to enhance your looks (e.g., facelifts, electrolysis, liposuction, etc.) is not a tax-deductible expense.
On the other hand, if the plastic surgery you undergo is medically necessary, for example, getting a nose job to correct a deviated septum causing difficulty breathing, frequent sinus infections and/or heavy snoring, then, yes, it is a tax-deductible expense.
Plastic surgery used to correct an injury incurred from an automobile accident, animal bite or other traumatic accident is also considered tax-deductible, as congenital abnormalities cause deformities.
3. Family Pet
We know pets can be expensive, but nine times out of ten, the bills they incur will not be tax-deductible. The exception to that will be if the pet is actually a service animal.
According to an article published by Bankrate, “the cost of buying, training and maintaining a guide dog or other service animal for someone who has a physical disability is tax-deductible. This generally includes any expenses incurred to maintain the animal — including for food, grooming and veterinary care — so that it can perform its duties.”
2. Volunteer Work
Unfortunately, volunteer work is not a tax-deductible expense. This holds true whether you’re volunteering your time to help a nonprofit or you’re working on a special project for a charity.
There is a bit of good news: you can actually deduct any travel expenses you incur if the volunteer work is done onsite, if you attend meetings onsite, or if you travel out of town for a meeting. The standard mileage rate for volunteer work is .14 per mile for charitable organizations.
1. Political Contributions
Believe it or not, political contributions are not tax-deductible– even though charitable contributions are.
According to an article published by MediaFeed.org, here’s the reason why: “The difference between deductible and non-deductible contributions has to do with the tax status of the organizations. ‘Political organizations, including campaigns, are organized under section 527 of the IRS tax code. Organizations that are set up for charitable, religious or educational purposes (among other ideals) are organized under section 501(c)(3) of the tax code. Contributions to those charitable organizations are deductible.”
If you are unsure what expenses are tax-deductible, don’t go it alone. Consult with a tax professional beforehand to make sure you don’t inadvertently try to claim a deduction that’s not even deductible by law.