2 Simple tax questions....?

Question

So I will be itemizing my deductions for the first time this year because I purchased a house. I have two questions though:

1.Starting in January what 2008 receipts should I begin keeping? Really I'm asking what things I am able to deduct (medical expenses not covered by insurance, association fees, repairs to the house, job related expenses). I'm looking for a pretty general list or where I can go to find one.

2. My boyfriend and I both own the house (both names on deed and mortgage), can we both take the deduction or can we split the deduction? Would it be in our best interest not to share the deduction?

Answer 1

For a list of itemized deductions, see the instructions for form 1040 schedule A. You can download it at irs.gov in the forms area.

If you and your boyfriend are both on the mortgage, and you split the payments, legally each of you can take the portion that you pay of the mortgage interest and real estate taxes. So if you split it evenly, you'd each get half.

Medical expenses that you pay yourself are only deductible for the amount that's over 7.5% of your income, so unless you have very high bills and lousy insurance, you probably won't get anything there.

State and local taxes are deductible. Most of that will show on your W-2. You can't deduct the social security, medicare and federal income tax withholding shown on your W-2.

Charitable contributions are deductible if you have a receipt from an eligible organization.

Homeowners association fees and repairs to the house are not deductible. If you make any major improvements, save the receipts, since that might lessen your tax if you sell the house if you owe any tax then.

Unreimbursed employee expenses (e.g. union dues) can be deducted for the amount that's over 2% of your income. Expenses of commuting to work are NOT deductible. Work clothes might be if they are uniforms.

Answer 2

The main receipts you should keep are for charitable contributions (including items donated to Goodwill or the Salvation Army). Medical expenses are not deductible until they reach a certain amount (you're much better off with a Flexible Spending Account if your employer offers them). You can also deduct property taxes and the tax associated with your car registration (the amount is broken out on your registration statement). You can also deduct state income or sales taxes. You cannot deduct association fees or the repairs to the house, but you should keep home repair/improvement receipts because they raise the base price of your house, which can affect how much income tax you pay when you sell the house.

Here's a link that should be helpful. Congratulations on your new home!

Answer 3

One look at the form. If you are making charitable donations, read IRS publication 526. Other stuff is in publication 529.

Two, how much money did each of you put up for the downpayment, how much money will each of you contribute towards the mortgage? Generally you must deduct the amounts based on the % you own and what you actually paid. You cannot fudge and let him claim all of them.