Ah, taxes. Yesterday, I talked about how the big jump in the standard deduction amount will now make it easier for an estimated 90% of Americans to do their taxes this year, since they’ll just claim the standard deduction instead of itemizing.

However, there are still several tax deductions you can take “above the line”, in other words, before you tack on that standard deduction. It’s important to understand what those are and how to apply them to your own situation, so today I’m going to cover a few of the more common above-the-line deductions.

  • Teachers, listen up! You can still take a deduction of up to $250 for any unreimbursed classroom expenses.
  • Next is Health Savings Accounts: Any HSA contributions you make are still deductible. If you aren’t piling as much money into a HSA as you can, you should go back and listen to episodes 32-34 on iTunes, where I talk about Health Savings Accounts. They are the holy grail of retirement savings accounts.
  • If you are making contributions to a Traditional IRA or 401k, those contributions are still tax deductible

Several other above-the-line deductions still exist - like student loan interest, and plenty of deductions for business owners and entrepreneurs. You’ll want to talk to your tax advisor to see what deductions apply specifically to you.

That’s it for today! Thanks for listening. Tomorrow we’re going to talk about one of the biggest changes buried in the Tax Cuts and Jobs Act - the rule change for Roth Conversions.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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