Deductions and Write-Offs
The most frequently asked tax questions related to Deductions and Write-Offs
Private School Tuition
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
Tuition paid for a child in first grade or higher cannot be used as a child care credit or a deduction on your tax return.
Nursery school payments
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
The amount you pay for nursery school or day-care that enables you (and your spouse on a joint tax return) to earn income can be used to calculate a Child Care Tax credit.
Can I claim a deduction for the costs of transportation for my child to the day care center ?
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
No. The costs of driving a dependent to or from a day-care center, or any other transportation, are not deductible and can not be used in a calculation of a child care tax credit.
Child Care Credit - payments to mother who lives with me
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
No. If you claim a relative as a dependent on your tax return, you may not claim a deduction or a child care tax credit for the payments made.
Standard Meal Allowance - in place of the actual meal costs
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
Yes. While away from home on business trips, if you find it difficult to maintain the actual records of meal costs, you may use a standard IRS meal allowance. The basic meal allowance in the U.S. for the current year is $52 a day. There are higher high-cost major metropolitan area rates available. You must keep a diary which includes the time, place and business purpose of the trip. Speak to your local CPA for the meal allowance in your area in your state. The rates are available online at www.gsa.gov/perdiem and in IRS Pub 1542.
Car loan Interest
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
No. Interest on personal loans such as car and credit card loans are not deductible. Home mortgage loans and interest for loans for business purposes are deductible.
Co-operative apartment Interest
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
Yes. You may claim interest on acquisition or home equity debt loans on residences. A residence includes a house, condominium, cooperative apartment, houseboat, mobile home or house trailer that has sleeping, cooking, and toilet facilities.
The deduction is allowed on IRS Schedule A.
The deduction is allowed on IRS Schedule A.
Home equity loan Interest
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
Yes. There are specific criteria and limitations associated with home equity loans, but you can deduct these expenses on IRS Schedule A with any other mortgage interest.
Pre-payment Penalty
Asked Monday, September 25, 2000 by an anonymous userCPA Answer:
Yes. The penalty you paid for pre-payment of your mortgage is deductible
as mortgage interest on IRS Schedule A.