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Tax deductions individuals can take in 2019

On Behalf of | Jan 14, 2019 | Income Taxes

While the tax law has changed in recent years, there are still many deductions that Georgia residents may be entitled to in addition to the standard deduction. For example, it may be possible to take a deduction for student loan interest up to $2,500. This is true for single filers who have a modified adjusted gross income of $80,000 or less. The amount increases to $165,000 for married couples filing jointly.

Those who have an health savings account and who fund them directly could be in line for a tax deduction. Contribution limits for individuals funding their own accounts was $3,450 in 2018 and $3,500 in 2019. Those who are funding accounts for their families could contribute $6,900 in 2018 and $7,000 in 2019. Individuals who are self-employed can take a variety of deductions. These deductions could be for health insurance premiums paid or for self-employment taxes paid during the year.

A deduction could also be taken for contributions made to a variety of retirement accounts such as a Simplified Employee Pension Individual Retirement Arrangement or a self-employed 401(k). If a person got a divorce before the end of 2018, alimony payments are generally deducted on a tax return. However, if the divorce was not finalized prior to the end of 2018, the new alimony rules would apply.

Filing returns and paying income taxes in a timely manner may prevent financial or other penalties from being levied by the IRS. If a taxpayer has questions about a return, it may be a good idea to talk with an attorney. In the event that a mistake is caught after a tax return has been filed, it is a good idea to amend the return quickly.