It’s no secret that tax codes are complicated. Lowering your tax liability and saving your money depends on maxing out the number of tax breaks you take and deductions you claim, but navigating the complex and ever-changing web of rules can be overwhelming. Not to mention the fact that the most common tax breaks, like charitable contributions and the deduction for mortgage interest, are reserved only for those taxpayers who itemize on their tax return, leaving the non-itemizers to fend for themselves.
Some taxpayers, especially those that do not have a mortgage, choose not to itemize and instead go with the standard deduction ($6,100 for single filers’ 2013 returns, double for joint filers). But just because you choose to take the standard deduction does not mean there aren’t a number of tax breaks you can take to lower your tax bills.
Here are four of the most overlooked tax deductions non-itemizers can claim on their next return
Student loan interest
The savings start with educational expenses. You can deduct up to $2,500 in interest on student loans. If your modified adjusted gross income is less than $60,000 for single filers, or $125,000 for joint filers. The deduction phases out, however, for filers with incomes above these limits.
If you meet certain requirements, you can potentially deduct part of your tuition and fee expenses as well—up to $4,000. Income limits still apply, as you can’t claim this deduction if your single filing income exceeds $80,000 or $160,000 for joint filers.
Job search expenses
Being out of work is difficult for anyone, but the deductions you can claim while searching for your next occupation help to relieve some of the pressure. Some of the expenses you can write off include hiring a recruiter, resumé preparation and traveling for job interviews. Even if you were unsuccessful in securing the position, you can still write off the expenses associated with the search.
There is one catch, however. You are only allowed to write off job search expenses if the job you were searching for is in your field. This means that if you are a short-order cook looking for work as a chiropractor, you cannot deduct the costs that accompany your transition from cracking eggs to cracking backs.
Moving expenses
Once you land that job, there is a good chance you will have to pull up your roots and move. In most cases, when transferring jobs employees pick up the bill for their relocation costs as a condition of employment. Fortunately, if the move is far enough away—50 miles farther from your old home than your previous workplace was, to be exact—then you can deduct most of your moving expenses. This includes packing and transporting your household goods, shipping your car and pets to your new residence, as well as the storage expenses for your and your family. You can even deduct 24 cents a mile plus what you paid for parking and tolls.
Foreign Tax Credits
Taxes paid in other countries may be a deductible credit against worldwide income and any used portion of the credits are carried over from year to year. Of course, you need to report your worldwide income as a U.S. tax resident but you might qualify for foreign-earned income exclusions (of up to $97,600 per taxpayer in 2013) if requirements are met.