TAX DEDUCTIONS FOR TEACHERS
Teachers should save their receipts for purchases of books and classroom supplies to receive a tax deduction for out-of-pocket expenses. Available to eligible educators in both public and private elementary and secondary schools, they must work at least 900 hours during a school year as a teacher, instructor, counselor, principal or aide. Educators may subtract up to $250 of qualified expenses from their adjusted gross income (AGI), and do not need to itemize deductions. Available for 2004 and 2005.

Teachers can deduct $250.00 for classroom supplies they purchased in 2004 and 2005.

STUDENT LOAN INTEREST

You can deduct up to $2,500 of student loan interest if your AGI is $130,000 or less ($65,000 for singles).

ESTIMATED TAX PAYMENTS

If your AGI was over $150,000 last year, you must pay at least 90% of this years tax due or 110% of last years tax liability, or face penalties. This may be a combination of withholding and estimated tax payments.

HYBRID VEHICLE DEDUCTION

Full $2,000.00 in 2004 and 2005.

VEHICLE DONATIONS TO CHARITY

Can be deducted by itemizers, but the deduction is limited to the amount the charity sells the car for at auction, effective January 1, 2005.

SALES TAX DEDUCTION

Taxpayers who itemize deductions will have a choice of claiming a state and local tax deduction for either sales or income taxes on their 2004 and 2005 returns.  The IRS will provide optional tables for use in determining the deduction amount, relieving taxpayers of the need to save receipts through the year.  Sales taxes paid on motor vehicles and boats may be added to the table amount, but only up to the amount paid at the general sales tax rate.  Taxpayers will check a box on schedule A, Itemized Deductions, to indicate whether their deduction is for sales or income tax.

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Last modified: 10 January, 2005