The year is fast approaching and the time to get your financial ducks in a row is getting shorter. Make sure you are getting all the tax breaks you can qualify for in order to lower your tax liability. There are eight tax breaks expiring at the end of 2013 – take advantage of them while you still can.
- Qualified educators can deduct up to $250 worth of unreimbursed classroom expenses. These deductions are taken before the adjusted gross income and regardless of whether the teacher itemizes other deductions or just takes a standard deduction.
- Exclusion of cancellation of indebtedness or principal residence. This tax break allows those individuals who have had a home foreclosed or short sale completed to not claim the debt forgiveness as taxable income.
- Transit benefits deduction.
- Mortgage Insurance Premiums can still be deducted through 2013. This provision is scheduled to expire after this year.
- IRA distributions to charity.
- State and local sales tax deduction allows you to deduct state sales tax if your state does not have sales tax or if the amount you paid in sales tax was higher than income tax.
- Electric vehicle credit.
- Home energy efficiency credit.
These tax breaks are all set to expire this year. It is not too late to get qualified for these credits and deductions.
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