Everyone wants to save money on their tax bill. But nearly two-thirds of taxpayers never itemize their deductions—a move that could add up to giving the government free money.
If your itemized deductions are more than the standard deduction, you’ll end up owing less and putting more in your emergency fund.
Itemizing isn’t as hard as it sounds; you just add up all your tax-deductible expenses for the year. There’s even a worksheet in your IRS tax return instructions (“Schedule A”) to help you through the process.
According to Virginia-based tax expert and CPA K.M. Pittman, “You should always try to itemize—because it will give you the greatest reduction to your taxable income.”
On the fence? Consider itemizing if you own a home, paid out-of-pocket for large medical expenses last year, weren’t reimbursed for business expenses, or donated a lot to tax-exempt charities.