Tax Deductions Explained

Tax deductions are essential for reducing your taxable income, which can lead to significant savings. They allow you to subtract certain expenses from your total income, thereby lowering the amount of income that is subject to tax. Common deductions include mortgage interest, student loan interest, and medical expenses.

Types of Deductions

• Standard Deduction: A fixed dollar amount that reduces the income you're taxed on.
• Itemized Deductions: Specific expenses that can be deducted, such as charitable contributions and medical expenses.

Understanding which deductions you qualify for can help you maximize your tax savings.