Wednesday, January 17, 2007

Extended Federal Tax Deductions Not on the 2006 Tax Forms

Three popular tax breaks technically ended in 2005 - deductions for state sales taxes, college tuition and fees, and educator out-of-pocket classroom expenses. These tax deductions were extended at the very end of the 2006 congressional session and didn't make it onto 2006 tax forms.

You must itemize to claim the sales tax deduction, and if you also paid state income tax, you must decide which of those state levies to claim. Both education-related deductions, however, are available to anyone regardless of whether you itemize or take the standard deduction amount.

The only issue with these three tax breaks is where on the tax form to claim them. Because they were reinstated after the IRS printed the 2006 tax forms, you'll have to make some special notations, especially if you file paper forms instead of using tax software.

You don't have to worry if you use tax preparation software. These tax deductions are included in the software or a download will be available so that the deductions are included.

If you use a tax preparer they will be familiar with all the new tax laws and changes. You will need to be familiar with these deductions to provide them with the information.

More information at

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