The second category of itemized deductions on Schedule A is Taxes Paid. This section is used to report and deduct real estate taxes, personal property taxes, and other taxes. The taxpayer is also able to deduct either state and local income taxes or general sales taxes. For general sales taxes, you can claim either actual sales taxes paid, or use the optional sales tax tables for the state the taxpayer lives in.
The third category is Interest Paid. The most common type of interest recorded here is home mortgage interest. Normally, this amount comes from your Form 1098 which is provided by your mortgage lender. Some taxpayers also have home mortgage interest not reported on Form 1098, points not reported on Form 1098, qualified mortgage insurance premiums, and investment interest.
Gifts to Charity is the fourth category on Schedule A. The charitable gifts include gifts by cash or check, and gifts other than by cash or check. Only gifts to qualified charitable organizations are deductible, and there are limits to the amount that can be claimed. If there is any carryover from a prior year, it is listed here.
The fifth category of itemized deductions is Casualty and Theft Losses. If claiming any casualty or theft losses, the taxpayer is required to attach Form 4684 to his or her income tax return.
The sixth category on Schedule A is Job Expenses and Certain Miscellaneous Deductions. Like Medical and Dental Expenses, only the excess over a pre-determined percentage of adjusted gross income is deductible. In this case, only the amount over 2% of adjusted gross income is allowable. This category includes unreimbursed employee expenses, tax preparation fees, safe deposit box fees, and more.
The seventh and final category of itemized deductions is Other Miscellaneous Deductions. This category includes gambling losses to the extent of gambling winnings and federal estate tax on income in respect of a decedent.
If your adjusted gross income is above a certain threshold, your itemized deductions may be limited.
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