Itemized Deductions

[GTFan]

Illinois does not have any itemized deductions.

It's not whether the state has itemized or not, it's that Georgia allows you to take the full amount of the fed itemized deductions you have off of GA income (with no limits), but if you don't itemize fed all you get is $3k off your GA income. Essentially they're shafting all the folks that can't itemize because they don't have $12k+ in deductions, which means as usual the higher income folks get more of the benefit if they have the expenses.

 

[BBQ-Nut]

College Education expenses?


I have one son in college now and another starting in a year.


2014 will be our first year we will get to claim this - so still looking into the rules.


I think if your AGI<$120K you get up to $4k deduction but then it goes down to $2K

 

[RetireAge50]

Instead of the Education Deduction we use the American Opportunity tax credit.

 

[FIRE'd@51]

State of GA really pisses me off with how they treat fed itemized deductions - if you have them you can deduct the full amount from GA income, but if you don't have enough to reach the threshold (and take the fed standard) they only give you $3k off as a standard deduct. And it's been that way for years, never indexed to inflation. Can easily cost you $500+ in extra GA income tax just because you don't itemize.

Any other states screw you over like this?

VA has something similar (and I believe some other states do also). In VA you can only itemize on the state return if you itemize on the Federal. If you take the standard deduction on the Federal, you must take the standard deduction on the state as well ($6K for married filing jointly). It is possible that you can come out better off by itemizing on the Federal if you are just a little below the standard deduction just to be able to itemize on the state - you need to calculate it both ways.

 

[N02L84ER]

Illinois doesn't have either itemized deductions or standard deductions, but they do allow a deduction for property taxes on the primary home by subtracting 5% of the property taxes from the total state taxes owed.

 

[Bikerdude]

Is state sales tax still available as a deduction? I thought that 2013 was the last year.


Hmm - looks like there is legislation in congress right now to extend this. So it's still up in the air. Your tax breaks in limbo as Washington quarrels - Dec. 2, 2014

Looks like it easily got through the House.

https://www.congress.gov/bill/113th-congress/house-bill/5771

 

[Travelwanted]

You can put in a dummy person in turbotax or taxact to see what deductions are possible.

 

[Sunset]

2014 will be the first time that we "bunched" over a two year period. Paid property taxes and charitable donations in late (really late) 2013. Only paid required stuff in 2014. Bunched state income tax to the extent we could. Will open the flood gates in early 2015.

Ditto,

For Fed taxes, we save some $$$ this way:
Our itemized list was close but just under the standard deduction.

Now we have started doing is lump together our property taxes by pre-pay some at end of year for the next year.
Then the next year we take the standard deduction.
This way we save about $500 every 2 years compared to simply taking the standard deduction every year.

 

[jebmke]

VA has something similar (and I believe some other states do also). In VA you can only itemize on the state return if you itemize on the Federal. If you take the standard deduction on the Federal, you must take the standard deduction on the state as well ($6K for married filing jointly). It is possible that you can come out better off by itemizing on the Federal if you are just a little below the standard deduction just to be able to itemize on the state - you need to calculate it both ways.

Maryland is the same way. Crappy standard ded. often pays to itemize even if it reduces the Fed. tax. Also sometimes pays to take sales tax ded. instead of state income tax since sales tax is ded. for state but state income tax is not.