Fund a health savings account. You also can lower your tax bill by making a 2015 contribution to a health savings account by the tax deadline. This account is paired with a high-deductible health plan and allows you to invest money before taxes are taken out. The money can later be withdrawn tax-free to pay qualified medical expenses. For 2015, you can invest up to $3,350 in a health savings account, plus an extra $1,000 if age 55 or older.
For instance, if you rented out a room or house for more than 14 days during last year, you must follow the tax rules for rental property owners, says Hamp;R Block. The good news: A portion of your mortgage interest, real estate taxes and expenses maintaining the rental property may be deductible depending on how many days you stayed there.
Meanwhile, Uber and Lyft drivers are usually considered self-employed and subject to 15.3 percent self-employment tax to cover Social Security and Medicare taxes, Hamp;R Block says. The drivers, though, can deduct expenses such as gas, repairs and vehicle licenses.
Need Help Filing Your Taxes? AARP Foundation Tax-Aide Can Help
Choose the sales or state income tax deduction. A federal tax break involving state sales taxes had expired but was recently revived and made permanent by Congress. It allows taxpayers to deduct the state and local sales taxes they paid during the year on their federal returns instead of the amount they paid in state and local income taxes. Being able to deduct sales tax benefits residents in states without an income tax to deduct --Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming.
But even if you don't live in one of those states, deducting sales tax may make sense if you made a big purchase last year and paid more in state sales tax than in income tax.
Please see item 7 on the individual taxpayer info on this release.