During tax planning and preparation, you must first decide whether to take the standard deduction. Even if you elect not to itemize on your Federal return, you should be aware that you can still claim New York State tax deductions for medical expenses, interest and some other personal expenditures.
4 New York State Tax Deductions to Consider
Although the standard deduction is always a popular choice, New York State tax deductions can provide significant tax savings (even after the Federal government capped state and local tax deductions at $10,000).
If you are considering itemizing your state return, you might be eligible to cut your tax bill with these New York State tax deductions.
1) Medical and Dental Expenses
In New York State, some medical and dental expenses can be deducted on your state income tax return. To qualify, the expenses must have been paid in the last year for treatments, such as the costs of diagnosis, care or prevention of diseases. You cannot deduct expenses that relate to general health and wellness, like vitamins or a day at the spa.
Certain types of interest, like home mortgage interest, are available for New York state tax deductions, too. Generally speaking, you can deduct all of the money you have paid in home mortgage interest as long as you are legally liable for the loan.
3) Casualty and Theft Loses
Although you may not realize it, the New York State government may partially reimburse you for your misfortune during tax season. Your personal casualty and theft are often eligible for New York State tax deductions.
Many types of incidents may help you receive a New York State tax deduction, including:
- Car accidents
4) College Tuition
You may either elect to take a tax credit or include your qualified expenses in your itemized list of New York State tax deductions. This tax benefit is only available to you if you were a state resident for the entire year and paid qualified undergraduate tuition for yourself, your spouse or a dependent.
However, you are required to itemize your Federal return in order to qualify for this type of deduction.
The Tax Deadline is not so Far Away
By beginning individual income tax preparation early, you will be able to make a better judgement call about which types of tax deductions or credits you would like to claim.
You have until April 15, 2020 to file your taxes this year. The sooner you get started, the sooner you can start spending your refund check.
If you are in a quandary about how to approach tax preparation, contact a local accountant.