Be sure to keep track of all potential deductions during the year. It’s always better to have too much information than not enough.
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Keep your deductible receipts and checks for at least three years after you’ve filed them.
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Itemized deductions are expenses deductible against your Adjusted Gross Income. Examples of these expenses include medical costs, real estate tax, mortgage interest and charitable contributions.
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To claim an exemption for an older relative, they do not have to live with you, but you do have to pay over one half of the person’s support for that year, and their gross income must be less than the exemption amount.
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The Educator Expense Deduction is available for a teacher, instructor, counselor, principal or aide in a public or private school who works 900 hours during a school year. For 2005, the $250 deduction is allowed for purchases of books and classroom supplies, so be sure to keep your receipts for this deduction.
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You are allowed to deduct up to $2,500 of student loan interest even if you don’t itemize deductions.