Like Most Americans during this time of year, you’re either highly anticipating that hefty income tax return check for 2016 (or received it already if you were really eager), or scrambling to get it filed still if you’re more of a “I’ll-get-it-done-tomorrow” type of person.
Either way, U.S. News and World Report reports that most Americans can expect their income tax return to be nearly $2,900 on average. In addition, the IRS reports that by April 25, 2014, it payed over $224 billion in income tax returns.
U.S. News and World Report also reported that many people greatly benefit from big tax returns — however they’ve found that if you are getting a nice fat check, then it probably really is too good to be true.
Because getting large income tax returns typically means that you’ve payed too much taxes with each paycheck for that year.
This is why the IRS gives income tax returns each year, however they are not doing so with interest. And on top of that, many Americans overlook crucial tax deductions that they could have claimed — thus, losing even more money.
Most tax payers know the basics when filing for their income tax returns, like filling out your W-4 properly, claiming dependents, and other itemized tax deductions.
Yet Turbo Tax reports that many Americans are still burning a hole in their pockets with these woefully overlooked income tax return deductions, which are all too common.
- State sales taxes
- Reinvested dividends
- Out-of-pocket charitable contributions
- Student loan interest paid by Mom and Dad
- Moving expense to take first job
- Child and Dependent Care Tax Credit
- Earned Income Tax Credit (EITC)
- State tax you paid last spring
- Refinancing mortgage points
- Jury pay paid to employer
And Deseret News reported that the IRS does not track the dollar amount of unclaimed deductions and even tax professionals have come to the consensus that a lot tax deduction and credit money are neglected by tax payers.
“For instance, the earned income tax credit is the most commonly overlooked break for most Americans. The maximum credit for the EITC is $6,242 — you’re talking about a lot of money.”
How Should Americans Feel about missing out on all of these potentially income tax deductions every year?
Swindled? Cheated? Furious perhaps? Quite the contrary, instead Twitter users poked fun at their own shortcomings each year under the hashtag called #RejectedTaxDeductions.
The income-tax-return-themed hashtag appears to have been made in jest by Twitter users. However maybe some of the claims are valid enough to catch the IRS’s attention?
Income tax deductions claims such as vanity and arachnophobia for one.
To making sure your hair is always stylish.
Or other issues and addictions.
But amid all of the satire about everyone’s favorite financial holiday, came some legitimate and insightful nuggets which many income tax return filers also might have overlooked.
Like claiming your pets for instance.
Tax payers of Twitter are having fun with the #RejectedTaxDeductions hashtag, but if you’re serious about how much you can expect on your tax return, accounting for deductions and all, the Inquisitr already has it covered.
The best way to estimate how much your refund will be (or your tax payment) is to use an online tax return calculator.
The results probably won’t be 100 percent accurate, but it will get you in the ball park as to how much your income tax return will be for 2016.
So next time you file your income tax returns — or you truly are the aforementioned “I’ll-do-it-tomorrow” type and have yet to file them — leave no stone unturned when it comes to optimizing your return by claiming deductions.
[Getty Images/Joe Raedle]