Are you looking for ways to save money on your 2024 taxes? The Internal Revenue Service (IRS) has announced several new deductions and tax breaks that you can take advantage of when you file your return next year.
These new deductions can help you reduce your taxable income, which can save you money on your taxes. Some of the new deductions include:
In this article, we’ll take a closer look at these new deductions and explain how you can claim them on your 2024 tax return.
New Deductions For 2024
Save money on your 2024 taxes with these new deductions:
- Increased standard deduction
- New charitable deduction
- Expanded educator expense deduction
- New deduction for energy-efficient home improvements
- Increased child and dependent care credit
- New credit for qualified energy property
- Expanded deduction for qualified business income
- New deduction for qualified transportation expenses
- Increased deduction for disaster losses
- New deduction for qualified long-term care insurance premiums
These deductions can help you reduce your taxable income and save money on your taxes.
Increased standard deduction
The standard deduction is a dollar-for-dollar reduction in your taxable income. It’s a valuable tax break that can save you money on your taxes, even if you don’t itemize your deductions.
For 2024, the standard deduction amounts have increased. The new standard deduction amounts are:
- $13,850 for single filers
- $27,700 for married couples filing jointly
- $19,400 for heads of household
These increased standard deduction amounts mean that more taxpayers will be able to save money on their taxes. For example, a single filer who claims the standard deduction in 2024 will save $1,800 in taxes, compared to 2023. A married couple filing jointly who claims the standard deduction in 2024 will save $3,600 in taxes, compared to 2023.
If you’re not sure whether you should itemize your deductions or claim the standard deduction, you should do a little bit of math. Add up all of your potential itemized deductions, such as your mortgage interest, state and local taxes, and charitable contributions. If your total itemized deductions are greater than the standard deduction amount, then you should itemize your deductions. Otherwise, you should claim the standard deduction.
The increased standard deduction is a valuable tax break that can save you money on your taxes. Be sure to claim the standard deduction if you’re not itemizing your deductions.
New charitable deduction
The new charitable deduction allows taxpayers to deduct up to $600 of cash donations to qualified charities, even if they don’t itemize their deductions. This deduction is available to both single filers and married couples filing jointly.
To qualify for the new charitable deduction, the donation must be made in cash and it must be made to a qualified charity. Qualified charities include organizations such as churches, synagogues, mosques, and other religious organizations; educational institutions; and certain public charities.
The new charitable deduction is a valuable tax break for taxpayers who make charitable donations. It’s a simple way to save money on your taxes and support the causes that you care about.
Here are some examples of how the new charitable deduction can save you money on your taxes:
- A single filer who donates $600 to a qualified charity can save $90 in taxes.
- A married couple filing jointly who donates $1,200 to a qualified charity can save $180 in taxes.
The new charitable deduction is a great way to save money on your taxes and support the causes that you care about. Be sure to take advantage of this deduction when you file your 2024 tax return.
The new charitable deduction is a valuable tax break that can make it easier for taxpayers to give to charity. This deduction is available to both single filers and married couples filing jointly, and it can save you money on your taxes.
Expanded educator expense deduction
The expanded educator expense deduction allows eligible educators to deduct up to $300 of qualified expenses from their federal income taxes. This deduction is available to teachers, instructors, counselors, and certain other educators who work at elementary and secondary schools.
-
Qualified expenses
Qualified expenses include:
- Books, supplies, and other materials used in the classroom
- Professional development courses
- Computers and other electronic devices used in the classroom
-
Eligibility
To be eligible for the educator expense deduction, you must meet the following requirements:
- You must be a teacher, instructor, counselor, or other eligible educator.
- You must work at an elementary or secondary school.
- You must have spent at least $250 on qualified expenses out-of-pocket.
-
How to claim the deduction
To claim the educator expense deduction, you must file Form 1040, U.S. Individual Income Tax Return, and complete Schedule A, Itemized Deductions. You will need to enter the amount of your qualified expenses on line 23 of Schedule A.
-
Example
For example, a teacher who spends $400 on qualified expenses out-of-pocket can deduct $300 of these expenses on their federal income tax return. This deduction can save the teacher up to $80 in taxes.
The expanded educator expense deduction is a valuable tax break for eligible educators. This deduction can help offset the cost of out-of-pocket expenses that educators incur in order to do their jobs.
New deduction for energy-efficient home improvements
The new deduction for energy-efficient home improvements allows homeowners to deduct the cost of certain energy-efficient improvements from their federal income taxes. This deduction is available for improvements made to a taxpayer’s main home or a second home.
-
Qualified improvements
Qualified energy-efficient home improvements include:
- Insulation
- Windows and doors
- Roofs
- Heating and cooling systems
- Water heaters
- Solar panels
-
Eligibility
To be eligible for the deduction, the energy-efficient home improvements must meet the following requirements:
- The improvements must be made to the taxpayer’s main home or a second home.
- The improvements must be installed by a qualified contractor.
- The improvements must meet certain energy-efficiency standards.
-
How to claim the deduction
To claim the deduction for energy-efficient home improvements, you must file Form 1040, U.S. Individual Income Tax Return, and complete Schedule A, Itemized Deductions. You will need to enter the amount of your qualified expenses on line 28 of Schedule A.
-
Example
For example, a taxpayer who installs $10,000 of qualified energy-efficient home improvements can deduct $5,000 of these expenses on their federal income tax return. This deduction can save the taxpayer up to $1,250 in taxes.
The new deduction for energy-efficient home improvements is a valuable tax break for homeowners who make energy-saving improvements to their homes. This deduction can help offset the cost of these improvements and make them more affordable for homeowners.
Increased child and dependent care credit
The increased child and dependent care credit provides a tax credit for taxpayers who pay for child care or other dependent care expenses. The credit is available to both single and married couples, and the amount of the credit depends on the taxpayer’s income and the number of qualifying children or dependents.
-
Credit amount
The maximum amount of the child and dependent care credit is $2,100 for one qualifying child or dependent, and $4,200 for two or more qualifying children or dependents. The credit is phased out for taxpayers with higher incomes.
-
Qualifying expenses
Qualifying child and dependent care expenses include:
- Daycare
- Babysitting
- Before- and after-school programs
- Summer camps
- Care for disabled dependents
-
Eligibility
To be eligible for the child and dependent care credit, you must meet the following requirements:
- You must have paid for child or dependent care expenses in order to work or look for work.
- The care must have been provided for a qualifying child or dependent.
- The qualifying child or dependent must live with you for more than half the year.
-
How to claim the credit
To claim the child and dependent care credit, you must file Form 1040, U.S. Individual Income Tax Return, and complete Schedule 2, Child and Dependent Care Expenses. You will need to enter the amount of your qualified expenses and the amount of your credit on Schedule 2.
The increased child and dependent care credit is a valuable tax break for families who pay for child care or other dependent care expenses. This credit can help offset the cost of these expenses and make it more affordable for families to work.
New credit for qualified energy property
The new credit for qualified energy property allows taxpayers to claim a tax credit for the purchase and installation of certain energy-efficient property. This credit is available for both residential and commercial property, and the amount of the credit depends on the type of property and the taxpayer’s income.
Qualifying property
Qualifying energy property includes:
- Solar panels and solar water heaters
- Wind turbines
- Geothermal heat pumps
- Biomass stoves and boilers
- Fuel cells
- Energy-efficient appliances
- Energy-efficient windows and doors
- Insulation and roofing materials
Credit amount
The amount of the credit for qualified energy property depends on the type of property and the taxpayer’s income. The credit is equal to 30% of the cost of the property, up to a maximum credit of $1,200 for residential property and $5,000 for commercial property.
Eligibility
To be eligible for the credit for qualified energy property, you must meet the following requirements:
- You must purchase and install the property in the United States.
- The property must be new and unused.
- The property must meet certain energy-efficiency standards.
How to claim the credit
To claim the credit for qualified energy property, you must file Form 5695, Residential Energy Credits, or Form 3468, Investment Credit, with your federal income tax return.
The new credit for qualified energy property is a valuable tax break for taxpayers who invest in energy-efficient improvements. This credit can help offset the cost of these improvements and make them more affordable for taxpayers.
Expanded deduction for qualified business income
The expanded deduction for qualified business income allows eligible taxpayers to deduct up to 20% of their qualified business income from their federal income taxes. This deduction is available to sole proprietors, partners, and S corporation shareholders.
-
Eligibility
To be eligible for the deduction for qualified business income, you must meet the following requirements:
- You must be a U.S. citizen or resident alien.
- You must carry on a trade or business in the United States.
- Your taxable income must be below certain limits.
-
Qualifying income
Qualifying business income includes:
- Income from a sole proprietorship
- Income from a partnership
- Income from an S corporation
- Income from certain rental and royalty activities
-
Amount of the deduction
The amount of the deduction for qualified business income is equal to 20% of your qualified business income, up to a maximum deduction of $50,000 for single filers and $100,000 for married couples filing jointly. The deduction is phased out for taxpayers with higher incomes.
-
How to claim the deduction
To claim the deduction for qualified business income, you must file Form 1040, U.S. Individual Income Tax Return, and complete Schedule C, Profit or Loss from Business. You will need to enter the amount of your qualified business income and the amount of your deduction on Schedule C.
The expanded deduction for qualified business income is a valuable tax break for small business owners. This deduction can help reduce your taxable income and save you money on your taxes.
New deduction for qualified transportation expenses
The new deduction for qualified transportation expenses allows taxpayers to deduct certain expenses related to transportation from their federal income taxes. This deduction is available to both employees and self-employed individuals.
-
Qualifying expenses
Qualifying transportation expenses include:
- Mileage expenses (up to a certain rate per mile)
- Parking fees and tolls
- Public transportation fares
- Certain other expenses related to transportation
-
Eligibility
To be eligible for the deduction for qualified transportation expenses, you must meet the following requirements:
- You must be an employee or a self-employed individual.
- You must have paid qualified transportation expenses in order to get to and from work.
- You must itemize your deductions on your federal income tax return.
-
Amount of the deduction
The amount of the deduction for qualified transportation expenses is limited to the amount of your qualified transportation expenses, up to a maximum deduction of $2,000 for employees and $5,000 for self-employed individuals.
-
How to claim the deduction
To claim the deduction for qualified transportation expenses, you must file Form 1040, U.S. Individual Income Tax Return, and complete Schedule A, Itemized Deductions. You will need to enter the amount of your qualified transportation expenses and the amount of your deduction on Schedule A.
The new deduction for qualified transportation expenses is a valuable tax break for taxpayers who incur transportation expenses in order to get to and from work. This deduction can help offset the cost of these expenses and make it more affordable for taxpayers to commute to work.
Increasedデス for disaster losses
The increasedデス for disaster losses allowsデス to deduct up to $100,000 of disaster-related losses from their federal income taxes. Thisデス is available to both individuals and businesses.
-
Qualifying losses
Qualifying disaster-related losses include:- Losses to property from a disaster, such as a flood, fire, or storm
- Losses to inventory from a disaster
- Losses to standing crops from a disaster
- Losses to animals from a disaster
-
デス
To be eligible for theデス for disaster losses, you must meet the following requirements:- You must have sustained a disaster-related loss in a disaster area that has been declared by the President or the Secretary of the U.S. Department of theデス.
- You must have filed a claim for reimbursement with your insurance company, if applicable.
- You must itemize your deductions on your federal income tax return.
-
Amount of theデス
The amount of theデス for disaster losses is limited to the amount of your disaster-related losses, up to a maximumデス of $100,000 for individuals and $500,000 for businesses. -
How to claim theデス
To claim theデス for disaster losses, you must file Form 4684, Casualties and Thefts, with your federal income tax return. You will need to enter the amount of your disaster-related losses and the amount of yourデス on Form 4684.
The increasedデス for disaster losses is a valuable tax break forデス who suffer disaster-related losses. Thisデス can help offset the cost of these losses and make it more affordable forデス to recover from a disaster.
New deduction for qualified long-term care insurance premiums
The new deduction for qualified long-term care insurance premiums allows taxpayers to deduct the cost of qualified long-term care insurance premiums from their federal income taxes. This deduction is available to both individuals and businesses.
-
Qualifying premiums
Qualifying long-term care insurance premiums include premiums paid for:
- Qualified long-term care insurance policies
- Qualified long-term care riders on life insurance policies
-
Eligibility
To be eligible for the deduction for qualified long-term care insurance premiums, you must meet the following requirements:
- You must be a taxpayer.
- You must pay qualified long-term care insurance premiums.
- You must itemize your deductions on your federal income tax return.
-
Amount of the deduction
The amount of the deduction for qualified long-term care insurance premiums is limited to the following amounts:
- $4,370 for single filers
- $8,740 for married couples filing jointly
-
How to claim the deduction
To claim the deduction for qualified long-term care insurance premiums, you must file Form 8863, Education Credits, with your federal income tax return. You will need to enter the amount of your qualified long-term care insurance premiums and the amount of your deduction on Form 8863.
The new deduction for qualified long-term care insurance premiums is a valuable tax break for taxpayers who pay for qualified long-term care insurance. This deduction can help offset the cost of these premiums and make it more affordable for taxpayers to plan for their future long-term care needs.
FAQ
In this FAQ section, we’ll answer some common questions about the new deductions for 2024.
Question 1: What is the increased standard deduction for 2024?
Answer 1: The increased standard deduction amounts for 2024 are: $13,850 for single filers, $27,700 for married couples filing jointly, and $19,400 for heads of household.
Question 2: How can I claim the new charitable deduction?
Answer 2: You can claim the new charitable deduction by taking the standard deduction and giving up itemizing your deductions. The new charitable deduction allows you to deduct up to $600 of cash donations to qualified charities, even if you don’t itemize your deductions.
Question 3: Who is eligible for the expanded educator expense deduction?
Answer 3: The expanded educator expense deduction is available to eligible educators who work at elementary and secondary schools. Eligible educators include teachers, instructors, counselors, and certain other educators.
Question 4: What are some examples of qualifying energy-efficient home improvements?
Answer 4: Qualifying energy-efficient home improvements include insulation, windows and doors, roofs, heating and cooling systems, water heaters, and solar panels.
Question 5: How much is the increased child and dependent care credit for 2024?
Answer 5: The maximum amount of the child and dependent care credit for 2024 is $2,100 for one qualifying child or dependent, and $4,200 for two or more qualifying children or dependents.
Question 6: How can I claim the new credit for qualified energy property?
Answer 6: To claim the new credit for qualified energy property, you must file Form 5695, Residential Energy Credits, or Form 3468, Investment Credit, with your federal income tax return.
Question 7: What are the eligibility requirements for the expanded deduction for qualified business income?
Answer 7: To be eligible for the expanded deduction for qualified business income, you must be a U.S. citizen or resident alien, carry on a trade or business in the United States, and have taxable income below certain limits.
Closing Paragraph for FAQ
These are just a few of the new deductions that are available for taxpayers in 2024. If you have any questions about these deductions, you should consult with a tax professional.
In addition to the new deductions, there are also a number of tax breaks and credits that you may be able to claim on your 2024 tax return. Be sure to review all of the available tax breaks and credits to see if you qualify for any of them.
Tips
Here are a few tips to help you take advantage of the new deductions for 2024:
Tip 1: Use the increased standard deduction
If you don’t itemize your deductions, you can save money on your taxes by taking the increased standard deduction. For 2024, the standard deduction amounts are $13,850 for single filers, $27,700 for married couples filing jointly, and $19,400 for heads of household.
Tip 2: Make charitable donations
If you make charitable donations, you can claim a deduction for up to $600 of cash donations to qualified charities, even if you don’t itemize your deductions. This new charitable deduction can save you money on your taxes.
Tip 3: Take advantage of the expanded educator expense deduction
If you’re an eligible educator, you can deduct up to $300 of qualified expenses from your federal income taxes. This deduction can help offset the cost of out-of-pocket expenses that educators incur in order to do their jobs.
Tip 4: Make energy-efficient home improvements
If you make energy-efficient improvements to your home, you may be able to claim a deduction for the cost of these improvements. Qualifying energy-efficient home improvements include things like Insulation, windows and doors, roofs, heating and cooling systems, water heaters, and solar panels.
Tip 5: Review all of the available tax breaks and credits
In addition to the new deductions, there are also a number of tax breaks and credits that you may be able to claim on your 2024 tax return. Be sure to review all of the available tax breaks and credits to see if you can save money on your taxes.
These are just a few tips to help you take advantage of the new deductions for 2024. If you have any questions about these deductions, you should consult with a tax professional.
Another tip is to choose the best filing status for your situation. Filing status can affect the amount of taxes you pay, so it’s important to choose the one that’s right for you. For example, married couples filing jointly can often save money compared to filing separately. This is because they can combine their incomes and deductions, which can lower their overall tax liability.
You can also save money on taxes by timing your income and deductions. For example, if you expect to have a lower income in one year, you may want to defer some of your income to that year. This can help you to avoid paying taxes on the higher income in the current year.
Finally, you should try to avoid the alternative minimum tax (AMT). The AMT is a parallel tax system that is designed to ensure that high-net-worth individuals pay a minimum amount of taxes. However, the AMT can also affect taxpayers with more moderate incomes. If you think you may be subject to the AMT, you should consult with a tax professional to see what steps you can take to avoid it.
These are just a few tips to help you save money on your taxes in 2024. By following these tips, you can reduce your tax liability and keep more of your hard-earned money.
Conclusion
The new deductions for 2024 can help you save money on your taxes. By taking advantage of these deductions, you can reduce your taxable income and keep more of your hard-earned money. Some of the most valuable new deductions include the increased standard deduction, the new charitable deduction, the expanded educator expense deduction, and the new deduction for energy-efficient home improvements.
In addition to these new deductions, there are also a number of tax breaks and credits that you may be able to claim on your 2024 tax return. Be sure to review all of the available tax breaks and credits to see if you can save even more money on your taxes.
The IRS has made it easier than ever to file your taxes. You can file your taxes online, by mail, or through a tax professional. If you need help filing your taxes, there are a number of resources available to you, including the IRS website, free tax preparation software, and volunteer tax preparers.
The deadline for filing your 2024 tax return is April 15, 2025. However, if you file for an extension, you have until October 15, 2025 to file your return.
Don’t miss out on the opportunity to save money on your taxes. Take advantage of the new deductions and tax breaks for 2024.
Filing your taxes doesn’t have to be a daunting task. By following these tips and using the resources available to you, you can file your taxes quickly and easily.