Things that are reimbursable on taxes

Cell phone bill
meals for work
medical expenses
health insurance
Computers
furniture




A

Acquisition debt. See Mortgage interest.

Acupuncture. You can deduct acupuncture costs. Enter them in Deductions and Credits under Medical.

Additional child tax credit. You may qualify for this credit If you claim the child tax credit for three or more children, or it more than wipes out your tax liability. This additional credit may even trigger a refund check from the IRS. See You and Your Family under Deductions and Credits.

Adoption credit. You can claim a tax credit for up to $11,650 of adoption expenses paid in 2008 or $12,150 paid in 2009. Keep in mind the credit starts to phase out once your adjusted gross income exceeds $174,730. If you adopt a child with special needs, your credit is the full amount, even if the adoption costs less. Enter your expenses in Deductions and Credits under You and Your Family.

Adjusted gross income (AGI). This is your income from all taxable sources, minus certain adjustments, and is the key to determining your eligibility for certain tax benefits and the phaseout of your eligibility for others. It's the amount from which deductions (the standard deduction or itemized deductions) and personal and dependent exemptions are deducted to arrive at the amount of taxable income that will actually be taxed.

Aircraft. Did you buy an airplane in 2008? If so, you may be able to deduct the sales tax you paid. Enter your information in Deductions and Credits under Taxes Paid.

Alcoholism. You can deduct payments to a treatment center, including the cost of room and board. Enter them in Deductions and Credits under Medical.

Alimony. You can deduct the alimony or separate maintenance payments you're required to make to your spouse or former spouse, or to a third party on behalf of that spouse. You can't deduct child support. Enter your alimony payments in Deductions and Credits under Other Deductions and Credits.

Animals. You can deduct the cost of guide dogs to aid the blind, deaf, and disabled. Enter your costs in Deductions and Credits under Medical.

Appraisal fees for casualty and theft losses. You can deduct appraisal fees paid to determine the amount of a casualty loss. Enter appraisal fees in Deductions and Credits under Other Deductions and Credits.

Appraisal fees for donated property. You can deduct appraisal fees you paid to determine the value of a donation. Enter appraisal fees in Deductions and Credits under Other Deductions and Credits.

Appreciated property. Donating appreciated property - such as stocks, bonds, mutual funds, or real estate that have increased in value - can supercharge the tax-saving power of your generosity. If you have owned the asset for more than one year, you can deduct the full-market value at the time of the gift, not just what you paid for it. You'll avoid the tax you would've incurred on the gain had you sold the property, and you'll be able to claim the larger deduction. Enter charitable donations of appreciated property in Deductions and Credits under Donations powered by ItsDeductible(R).

Armed Forces reservists. See Military reservists.

Artificial limb. You can deduct the cost of the prosthesis and any associated expenses. Enter your expenses in Deductions and Credits under Medical.

Assisted living. You can deduct a portion of the entrance fee and monthly or annual fees for an assisted-living facility. Enter your fees in Deductions and Credits under Medical.

Automobile, business use. If you drive your own car for business, you can deduct actual costs or, for 2008, 50.5 cents per mile from January 1, 2008 through June 31, 2008 and 58.5 cents per mile for driving from July 1, 2008 through December 31, 2008. Include what you spend for parking and tolls.

Automobile, donating to charity. Strict rules control your charitable deduction of a donated vehicle. In most cases, your deduction is limited to the amount the charity gets for the car when they sell it. Make sure the charity gives you this information within 30 days of the sale. Without it, the maximum deduction you'll be able to claim for the vehicle donation is $500. Enter your vehicle donation in Deductions and Credits under Donations powered by ItsDeductible(R).

Automobile, driving for charity. You can deduct 14 cents per mile you drove while performing services for a charity. Enter your charitable mileage in Deductions and Credits under Donations powered by ItsDeductible(R).


B

Bargain sales to charity. If you sell to a charity an appreciated asset you owned for more than one year, you can deduct the difference between the market value and the sale price as a charitable donation. But if the sales price is more than what you paid for the asset, you will have a taxable gain that will effectively offset part of the tax savings. Enter your donation in Deductions and Credits under Donations powered by ItsDeductible(R).

Benefits received for donations. If you receive a benefit from a charity in return for your donation, you must subtract the value of that benefit to determine your deductible contribution. You don't have to subtract anything if you gave at least $45.50 and received an item costing $9.10 or less. Enter your donations in Deductions and Credits under Donations powered by ItsDeductible(R).

Birth control pills. As with other prescribed medicines, you can deduct the cost of birth control pills. Enter your costs in Deductions and Credits under Medical.

Blind. A person is considered legally blind for purposes of qualifying for a larger standard deduction if he or she is totally blind; can't see better than 20/200 in the better eye with glasses or contact lenses; or has a field of vision of 20 degrees or less.

Blood sugar test kits for diabetics are deductible. Enter them in Deductions and Credits under Medical.

Blood transfusions are deductible. Enter the unreimbursed amount you paid for them in Deductions and Credits under Medical.

Boats. If you bought a boat in 2008, you may be able to deduct the sales tax you paid. Enter your information in Deductions and Credits under Taxes Paid.

Boats as homes. A boat that has eating, sleeping, and sanitary facilities can qualify as a first or second home. Thus, you can deduct mortgage interest paid on the loan secured by the boat to buy it. Enter your mortgage interest in Deductions and Credits under Your Home. (Note, however, that the interest is not deductible if you are subject to the alternative minimum tax.)

Braille books and magazines. You can deduct the amount you pay for a Braille book or magazine that exceeds that of a non-Braille copy. For example, say you pay $35 for a Braille edition of Brave New World. The non-Braille book costs $20. You can deduct the $15 difference. Enter your Braille costs in Deductions and Credits under Medical.

Breast reconstruction surgery following a mastectomy is deductible. Enter your costs in Deductions and Credits under Medical.

Business bad debt. If you make a loan to the company you work for and it fails to repay you, the loss can qualify as an employee expense. Enter your loss in Deductions and Credits under Employment Expenses.


C

Canadian drugs are not deductible. Although many Americans save money by purchasing prescriptions from Canadian pharmacies, either in person or via mail-order pharmacies, the costs can't be deducted.

Capital-loss carryover. Investment losses can be used to offset investment profit gains, and up to $3,000 of any excess loss can be deducted against other income, such as your salary. Capital losses not currently deductible because of the $3,000 limit can be carried over to future years. If you had a capital loss carryover from last year, be sure to revive it.

Car. You can deduct the cost of outfitting your car with special controls needed by a disabled person. Enter your costs in Deductions and Credits under Medical.

Cash contributions. You can deduct cash contributions to qualifying charities. These include educational organizations; churches, synagogues, and other religious organizations; and nonprofit organizations such as the Salvation Army, Red Cross, CARE, and Goodwill. You need a receipt for any contribution of $250 or more; a cancelled check alone is not sufficient. And, you must have either a receipt or a bank record (such as a canceled check) to back up smaller donations. Enter your donations of cash in Deductions and Credits under Donations powered by ItsDeductible(R).

Casualty loss. If your home was damaged or destroyed - by fire or storm, for example - you may be able to deduct a casualty loss on your return. Enter your losses in Deductions and Credits under Other Deductions and Credits.

Cell phone service. If your employer requires you to have a cell phone to perform your duties, but doesn't pay for your service, you can deduct the business portion of your monthly bills. Enter your costs in Deductions and Credits under Employment Expenses.

Charitable carryovers. Generally, your deduction for donations to charity in one year cannot exceed 50% of your adjusted gross income for that year (30% in the case of donations of appreciated assets and contributions to private foundations). You can carry over any excess for the following five tax years. The carryover expires, however, should you pass away before it is used up. Your heirs cannot claim it. If you can't take your full charitable contribution deduction this year, Turbo Tax will automatically carry over the remainder to next year's return. If you weren't able to take your full charitable contribution last year, enter or confirm your charitable carryovers in Deductions and Credits under Donations powered by ItsDeductible(R).

Charitable lead trusts. These trusts pay an annuity or other fixed amount to a charity for a set number of years. Enter your charitable donation in Deductions and Credits under Donations powered by ItsDeductible(R).

Charitable remainder trusts. These trusts pay an annuity or other fixed amount to one or more noncharitable beneficiaries for a defined amount of time, after which the remaining value of the trust is transferred to a charitable beneficiary. Enter your charitable donation in Deductions and Credits under Donations powered by ItsDeductible(R).

Child and dependent care credit. Take this credit for payments you make to care for a child under age 13 or other qualifying person while you work. The maximum amount of eligible expenses is $3,000 for one qualifying person and $6,000 for two or more. The credit rate ranges from 35% of eligible expenses for low-income taxpayers, to 20% for those with higher incomes. Enter the expenses in Deductions and Credits under You and Your Family. (Payments for child care made with funds from a child-care reimbursement or flexible spending plan at work do not count toward the credit.)

Child support. Child support payments ordered under a divorce decree are tax-free to the recipient, but are not deductible by the payer.

Child tax credit. If you have a qualifying child under the age of 17, this tax credit can knock $1,000 off your tax bill. Keep in mind the credit starts to phase out when your income exceeds $110,000 if you are married and filing jointly, $55,000 if you are filing separately, and $75,000 if you are filing as single, a head of household, or a qualifying widow(er). You can claim the credit for any number of qualifying children, but the total credit amount generally can't exceed the amount of tax you owe. We automatically calculate the child tax credit and additional child tax credits for you. To see the amount you get for your child tax credit and additional child tax credit, go to Deductions and Credits under You and Your Family. See Additional child tax credit.

Childbirth preparation classes. Fees for the mother qualify as a medical expense, but fees for the father or coach don't. Enter your fees in Deductions and Credits under Medical.

Chiropractor fees are deductible. Enter them in Deductions and Credits under Medical.

Christian Science practitioner fees are deductible. Enter them in Deductions and Credits under Medical.

College credits. See Hope credit and lifetime learning credit.

Combat pay. Military pay received by enlisted personnel serving in combat or designated peacekeeping efforts is tax-free up to the maximum pay for enlisted personnel (plus imminent danger/hostile fire pay), an amount that increases each year. Although tax-free, combat pay may now be counted as compensation when determining whether the taxpayer can contribute to an IRA or Roth IRA.

Commuting to a temporary job site. If commuting to your temporary job site is expected to last a year or less, you can deduct the associated costs. Enter them in Deductions and Credits under Employment Expenses.

Company cars. Your employer is required to count the value of your personal use of company cars as part of your taxable income. For 2008, approved methods of include 50.5 cents per mile for the first half of the year and 58.5 cents per mile for driving in July through December, or $1.50 each way if the car is used only to commute between home and work. If your employer pays for your company car, do not enter your vehicle mileage and expenses in Deductions and Credits under Employment Expenses.

Computer. It's difficult to deduct the cost of a computer unless you use it in your own business. However, if you use your computer to track investments and do your tax return, you may be able to depreciate part of the cost as a miscellaneous itemized expense. Enter your computer expenses in Deductions and Credits under Other Deductions and Credits.

Computer. If your employer requires you to have a computer to perform your duties but doesn't pay for it, you can depreciate the cost. Enter your computer depreciation in Deductions and Credits under Employment Expenses.

Conservation easements. If you donated to a conservation group or a state or local government an easement to restrict development of your property, you can deduct the resulting decline in value of your property. If you do this in 2008 or 2009, your deduction can offset up to 50% of your adjusted gross income. You can carry forward any excess for 15 years. Enter the decline in value of your property in Deductions and Credits under Donations powered by ItsDeductible(R).

Contact lenses and the costs of insuring them against their loss are deductible. Enter your costs in Deductions and Credits under Medical.

Conventions. For costs to be deductible, the convention must be in the North American area, which includes United States, Canada, Mexico, Puerto Rico, U.S. Virgin Islands, and a few other locations. If the convention isn't in this area, the cost to travel to the convention must be as reasonable as it would have been to stay in this area. There's a $2,000 cap on employee expense deductions for a convention held on a cruise ship, and there is an outright ban on deductions for expenses for any convention focusing on personal investments or financial planning. Enter your qualifying convention expenses in Deductions and Credits under Employment Expenses.

Cosmetic surgery is deductible if it is necessary for corrective or reconstructive purposes arising from a congenital abnormality, injury, or disease. You cannot deduct the cost of surgery done only for cosmetic reasons. Enter your costs in Deductions and Credits under Medical.

Coverdell education savings accounts. You can't deduct what you contribute to a Coverdell account. However, earnings are tax free if the money is used to pay college costs or expenses for elementary and secondary school education, including private and parochial schools. You can contribute up to $2,000 per beneficiary per year. The $2,000 cap is the limit on how much can be set aside for any student in one year, regardless of how many people contribute to that student's account. The amount you can contribute phases out for adjusted gross incomes above $95,000 ($190,000 if you are MFJ). These accounts used to be known as Education IRAs. Enter distributions from your Coverdell education savings account in Income under Less Common Income.

Crutches. You can deduct the cost of buying or renting crutches or other medically necessary equipment. Enter your costs in Deductions and Credits under Medical.


D

Damages. If you receive a settlement in a damage suit that includes money for future medical expenses, the amount is not taxable, but those future medical expenses will not be deductible until they exceed the amount of the award allocated to medical care. Enter medical expenses that exceed the award in Deductions and Credits under Medical.

Day camps. Save a few bucks in taxes while you work by paying for your kids' day camps with pretax dollars run through a dependent care reimbursement account. Keep in mind you can't deduct the cost of overnight camps. Alternatively, if you do not pay for day camps with a reimbursement from your employer, you can enter your costs in Deductions and Credits under You and Your Family to apply the expense toward the child care credit.

D.C. first-time homebuyer credit. If you bought a home in the nation's capital during 2008, you may qualify for a $5,000 credit. It doesn't really have to be your first home - just the first home you purchased in the District of Columbia after not owning one in D.C. for at least a year. It doesn't matter if you have owned a home elsewhere. Keep in mind this credit phases out at higher income levels. Enter the cost of your home in Deductions and Credits under Your Home. If you bought a home anywhere else in the country, see First Home credit.

Death of a dependent. If a dependent dies during the year, you can still claim an exemption for him or her on your return. Enter your dependent's information in the Personal Info tab in the Dependents category.

Dental treatment. You can deduct the cost of everything from diagnostic x-rays to orthodontic treatment to dentures, including treatments not covered by your insurance. Enter your dental expenses in Deductions and Credits under Medical.

Dependency exemption. Knock $3,500 off your taxable income for each child or other dependent you claim on your 2008 return. For example, say you have three dependents. You'll reduce your taxable income by $10,500 - reducing your tax bill by $2,625 if you're in the 25% bracket! Up to one-third of the value of the exemptions can disappear for higher-income taxpayers in 2008 and 2009. If this squeeze affects you, TurboTax will do the math. Keep in mind this exemption phases out at higher income levels. Enter the information for each dependent in the Personal Info tab in the Dependents category.

Dependent care credit. This credit will basically reimburse you for part of the cost of paying for the care for a child under age 13 or other qualifying person while you work. The maximum amount of eligible expenses is $3,000 for one qualifying person and $6,000 for two or more. The credit rate ranges from 35% of eligible expenses for low-income taxpayers, to 20% for those with higher-incomes. Enter the expenses in Deductions and Credits under You and Your Family. Expenses paid with funds from a flexible spending or child-care reimbursement plan at work doesn't count toward the credit.

Depreciation of equipment to manage investments. If you use a home computer to track your investments, you can depreciate the investment-use portion of the computer's cost over a six-year period. Enter your computer depreciation in Deductions and Credits under Other Deductions and Credits.

Doctor's fees. You can deduct payments to anesthesiologists, dermatologists, gynecologists, neurologists, obstetricians, ophthalmologists, osteopaths, pediatricians, podiatrists, psychiatrists, surgeons, and any other recognized medical practitioners. Enter your costs in Deductions and Credits under Medical.

Donation of car to charity. See Automobile, donating to charity.

Driving for charity. See Automobile, driving for charity.

Driving to doctors. You can deduct 19 cents per mile for each mile you drove for medical-related travel during the first six months of 2008; 27 cents a mile for trips during July through December. Enter your mileage in Deductions and Credits under Medical.

Drug addiction treatment. As with treatment for alcoholism, you can deduct the cost of treatment for drug addiction as a medical expense. Enter your costs in Deductions and Credits under Medical.

Dues to professional organizations are deductible. Enter your dues in Deductions and Credits under Employment Expenses.


E

Earned income. Compensation, such as salary, commissions and tips, you receive for your personal services. This is distinguished from "unearned" income such as interest, dividends and capital gains.

Earned income credit. If your adjusted gross income is below $41,645, you may be able to claim the earned income credit, which can wipe out your income tax bill and could give you a refund. The exact credit amount depends on your income level, as well as how many qualifying children you have. For single taxpayers with no qualifying children, for example, this credit disappears when income exceeds $12,880. Enter information in Deductions and Credits under You and Your Family to see if you qualify.

Economic stimulus payments. These 2008 payments - generally ranging from $300 to $600 for single taxpayers and $600 to $1,200 for couples filing joint returns, plus $300 for each qualifying child claimed on 2007 tax returns - were actually prepayments of a tax credit created for 2008 tax returns that will be filed in the Spring of 2009. Most taxpayers received the full value of their credits via a check or electronic deposit received in 2008. Others will claim the balance when they file 2008 returns.

Education. You can deduct the cost of courses designed to maintain or improve the skills needed for your present job, or required by your employer or the law to keep that job. However, you may save more by claiming the Hope or lifetime learning credits instead. To claim an education credit, enter your costs in Deductions and Credits under Education. If you don't qualify for one of the education credits, enter your costs under Employment Expenses.

Education IRA. See Coverdell education savings accounts.

Educator expenses. If you're a K-12 teacher or teacher's aide, you may be able to deduct up to $250 of out-of-pocket expenses for classroom supplies without restrictions. Anything over $250 we automatically move to job-related expenses - you don't have to enter your expenses in two places. Enter all of your teaching-related expenses in Deductions and Credits under Employment Expenses.

Elderly or disabled credit. You may be able to take the elderly and disabled credit if you were age 65 or older at the end of 2008, or if you are retired on permanent and total disability. Enter your information in Deductions and Credits under Other Deductions and Credits.

Elementary and secondary education. Most tax breaks are aimed at job-related training or college education. But funds that grow tax free in a Coverdell education savings account can be used for elementary and high school expenses. You can even cover the cost of a computer and educational software for the student. Enter distributions from your Coverdell education savings account in Income under Other Income.

Employment-agency fees and other costs of looking for a job in the same line of work are deductible. Enter your costs in Deductions and Credits under Employment Expenses.

Energy credits. You may be able to claim a credit for energy-saving home improvements you made in 2008. Eligible costs include solar water heating property, solar electric property, and fuel cell property. - Credit is 30% of the cost with a maximum of $2,000 for qualifying solar water heating property costs and qualifying solar electric property costs. - Fuel cell property costs are limited to $500 for each half (0.5) kilowatt of capacity (no annual maximum). Enter your qualifying energy-efficient home improvements in Deductions and Credits under Your Home.

Entertainment. If your job requires you to entertain clients, you can deduct 50% of the unreimbursed cost. Enter your costs in Deductions and Credits under Employment Expenses.

Exchange students. If you have an exchange student living with you, you can deduct $50 a month as a charitable contribution. However, you don't get this deduction if, at the same time, your child is living with a family in a foreign country. Enter the deductible amount in Deductions and Credits under Donations powered by ItsDeductible(R).

Expensing heavy SUVs. First-year depreciation deductions for business vehicles put into service in 2008 are generally limited to $10,960. However, if you purchased a sport-utility vehicle with a loaded gross vehicle weight rating of more than 6,000 pounds, you can deduct all or part of the cost in the year of the purchase, rather than depreciating the cost over time. For SUVs with loaded weights between 6,000 and 14,000 pounds, you can expense up to $25,000 of the cost of the vehicle. Then, 50% of the remaining cost can be deducted as "bonus" depreciation. Then, 20% of the remaining cost can be deducted as regular first-year depreciation. For heavier SUVs, the rules are even more liberal: You can expense up to $250,000 of the cost. (If your SUV cost more than that, we want a ride!) Enter your vehicle information in Income under Business Income and Expenses.

Expensing pickups. If you bought a pickup truck in 2008 for your business, you can expense up to $250,000 if its loaded gross vehicle weight rating exceeds 6,000 pounds. To qualify, the vehicle must have a cargo area at least six feet in length that is separate from the passenger compartment. Enter your vehicle information in Income under Business Income and Expenses.

Eyeglasses. Deduct the cost of your eyeglasses and eye exams. Enter them in Deductions and Credits under Medical.

Glossary: F - J
(A - E) (F - J) (K - O) (P - T) (U - Z)

F

Facade easements. You can deduct your donation of an easement that preserves the facade of a historic building. Keep in mind your donation must be made to a qualifying charity to qualify for this deduction. Enter your donation in Deductions and Credits under Donations powered by ItsDeductible(R).

Fee-based government official. If you performed services as an employee of a state or local government and you were paid in whole or in part on a fee basis, claim your business expenses in performing those services as an adjustment to income. Enter your fees in Deductions and Credits under Employment Expenses, and be sure to check the box for fee-based government officials.

Fellowships. See Scholarships and fellowships.

Fertility treatments can be deducted as a medical expense. Enter your costs in Deductions and Credits under Medical.

Filing status. Your status determines the size of your standard deduction and the tax-rates that apply to your income. For tax purposes, you are considered single, married filing jointly, married filing separately, head of household or qualifying widow or widower.

First home credit. If you bought your first home after April 8, 2008, and before July 1, 2009, you can claim a tax credit of up to $7,500 on your 2008 return. A credit reduces your tax bill dollar-for-dollar. A house is considered your first home as long as you did not own a primary residence in the U.S. during the three years prior to the purchase. If you buy the home during the first six months of 2009, you can choose whether to claim the credit on your 2008 or your 2009 return. The credit is phased out at higher income levels and does not apply if you are subject to the alternative minimum tax. Also, this credit must be paid back to the IRS. Beginning two years after you claim the credit, you must pay $500 in extra tax each year for 15 years, assuming your qualify for the full $7,500 credit. Enter your information in Deductions and Credits under Your Home.

Flexible-spending account. See Reimbursement plans.

Foreign tax credit on dividends. If you paid foreign taxes on dividends you received (including taxes paid for your by a mutual fund in which you invest), claim an income tax credit to recover the cost via lower federal taxes. Enter your information in Deductions and Credits under Taxes Paid.

Fundraiser hosting costs. If you host a fundraising event for a charity, deduct as a charitable contribution your unreimbursed expenses. Enter your costs in Deductions and Credits under Donations powered by ItsDeductible(R).


G

Gambling losses. If you reported any gambling winnings as taxable income, you can deduct up to that same amount in losses. Enter your gambling losses in Income under Less Common Income.

Guide dog. You can deduct the cost of acquiring and caring for a guide dog for the blind, deaf, or disabled, including the cost of the dog's care. Enter your expenses in Deductions and Credits under Medical.


H

Head of household. A filing status with lower tax rates for unmarried or some married persons considered unmarried (for purposes of this filing status) who pay more than half the cost of maintaining a home, generally, for themselves and a qualifying person, for more than half the tax year.

Health Savings Account. HSAs allow Americans under age 65 to make tax-deductible contributions to a special account tied to a high-deductible health insurance policy. Earnings inside the HSA are tax deferred (just like in an IRA) and withdrawals are tax free if used to pay medical bills, including the deductible on the health insurance policy. Non-qualifying withdrawals of earnings before age 65 are taxed and hit with a 10 percent penalty.

Hearing aid. You can deduct the cost of the device and any associated fees. Enter your costs in Deductions and Credits under Medical.

High Holy Days tickets. Deduct amounts you pay to a synagogue for tickets to special religious events. Enter them in Deductions and Credits under Donations powered by ItsDeductible(R).

Home building materials. If you purchased materials to build a new home or for a home improvement, you may be able to deduct the sales tax you paid. Enter your information in Deductions and Credits under Taxes Paid.

Home equity debt. You can deduct interest on up to $100,000 of debt secured by your first or second home - using a second mortgage or home equity line of credit - regardless of how the money is used. Enter your home equity loan in Deductions and Credits under Your Home.

Home office deduction. You can deduct the costs of a home office that you use exclusively and regularly for business. This includes depreciation, utilities, and insurance for the office portion of your home. If you use the office for your own business, enter your information in Income under Business Income and Expenses. If you use your office to manage rental property that you own, enter your information in Income under Rentals and Royalties.

Home office expenses. It's tough for employees to get this deduction because in order to qualify, the home office must be for your employer's convenience. You must be required to work at home, not simply want to. You must also use part of your home regularly and exclusively as your office. If you qualify, enter your home office information in Deductions and Credits under Employment Expenses.

Home improvements required by medical conditions - such as a filtration system to combat allergies or an entrance ramp for a disabled homeowner - can be deductible. However, if your home's value increases as a result of the improvements, you'll need to subtract the amount of the increase in value from the home improvement costs first. Enter your home improvement costs for medical conditions in Deductions and Credits under Medical.

Hope credit. You can take the Hope credit for tuition and fees you paid for yourself, your spouse, or your child, as long as it is for the first two years of college. The maximum credit is $1,800 per student. Keep in mind the credit phases out as adjusted gross income rises above $48,000 for singles and $96,000 for married couples. Enter your education expenses in Deductions and Credits under Education.

Hospitalization. You can deduct hospital costs, including the cost of meals, not covered by insurance. Enter your costs in Deductions and Credits under Medical.

Household employees. If someone works in your home - as a child-care provider, for example, or housekeeper or gardener - as your employee (rather than as an independent contractor or an employee of a service company), you may be responsible for paying Social Security and Medicare taxes for the employee. This requirement is triggered in 2008 if you pay the employee $1,600 or more during the year. This is also sometimes called the "nanny tax". (If you pay an employee $1,000 or more in any calendar quarter, you must pay federal unemployment tax.)

Hybrid and diesel vehicle credit. You can claim a credit in 2008 for buying a hybrid vehicle that runs on a combination of gasoline and electric power. Starting in 2008, several "clean burn" diesel vehicles sold in the U.S. also qualify for a tax credit. Depending on the vehicle's fuel economy, the tax credit can be as high as $3,400. Keep in mind, that once a manufacturer sells 60,000 of these vehicles, the credit phases out. Enter your hybrid or diesel vehicle information in Deductions and Credits under Cars and Other Things You Own.



I

Impairment-related work expenses. You can deduct your impairment-related work expenses if you have a physical or mental disability that limits your being employed, or substantially limits one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning, and working. Enter your costs in Deductions and Credits under Employment Expenses.

Imported drugs. The cost of imported drugs is not deductible. See Canadian drugs.

Incentive stock option. An option that allows an employee to purchase stock of the employer below current market price. For regular income tax purposes, the "spread" or "bargain element" - the difference between the price paid and market value of the stock - is not taxed when the option is exercised. Rather, it is taxed when the stock is sold. For alternative minimum tax purposes, however, the spread is taxed in the year the option is exercised.

Individual 401(k). Sometimes called a solo 401(k), this relatively new retirement plan for self-employed taxpayers allows you to stash a percentage of your self-employment earnings in a tax-sheltered account. Enter your contributions in Income under Business Income and Expenses.

Insurance. You can deduct premiums you pay for health insurance, prescription drug insurance, contact lens replacement insurance, Medicare Part B and Medicare Part D, Medicare supplemental policies, student health fees, and a portion of long-term care policies. Enter your premiums in Deductions and Credits under Medical.

Investment advice. You can deduct amounts paid for financial planning, tax, or investment advice, including periodicals, investment newsletters, tax-preparation software, and online. Enter safe-deposit box fees and investment advisor fees in Deductions and Credits under Retirement and Investments. Enter tax preparation fees under Other Deductions and Credits. Enter all other investment-related expenses under Other Deductions and Credits.

Investment interest. If you itemize, you can deduct certain investment interest expenses. There are some restrictions. Enter investment interest in Deductions and Credits under Retirement and Investments.

IRAs. For 2008, you and your spouse can contribute up to $5,000 of earned income to a traditional individual retirement account. Anyone at least 50 years old by the end of the year can contribute $6,000. You can fully deduct your contributions if neither you nor your spouse was an active participant in an employer plan during 2008. If one of you was a member of a plan, there are some income limits that can restrict or eliminate the deduction. If you contribute to both a traditional IRA and a Roth, the $5,000/$6,000 contribution limit applies to the combination. Enter your IRA contributions in Deductions and Credits under Retirement and Investments.

IRA custodial fees. You can deduct IRA trustee or custodial fees that you pay directly out of your own pocket. You can't deduct fees that are debited from your IRA. Enter your IRA custodial fees in Deductions and Credits under Retirement and Investments.

IRA loss. See Loss on an IRA.

IRA payouts for first-time homebuyers. You can do an early withdrawal (before age 59 1/2) of as much as $10,000 from a traditional IRA without penalty if the money is used to buy a first home for yourself, a child or grandchild, or your parents or grandparents. Although the payout avoids the normal 10% early-withdrawal penalty, it is taxed. If a Roth IRA is involved, see Roth IRA payouts for first-time homebuyers. Enter your IRA withdrawals in Income under Retirement Distributions.

IRA withdrawals for education. The typical 10% penalty for early (pre-age 59 1/2) withdrawal is waived if the distributions are used to pay higher education expenses for yourself, your spouse, or a dependent. However, the payout from a traditional IRA is taxed. There is no penalty on withdrawals from a Roth IRA used to pay educational expenses before age 59 1/2. But if earnings come out of a Roth prior to age 59 1/2, the earnings will be taxed. Enter your IRA payouts in Income under Retirement Distributions.


J

Job-hunting costs. You can deduct the costs of looking for a new job in your same line of work. Deductible expenses can include the cost of want ads, employment-agency fees, the cost of printing and mailing resumes, and travel expenses such as transportation, lodging, and 50% of food, if your job hunting takes you away from home overnight. Enter your job hunting costs in Deductions and Credits under Employment Expenses.

Job-related education. You can deduct the cost of education that maintains or improves skills you use on the job, or that is required to maintain your job. Education that qualifies you for a new trade or business, such as law school, is not eligible for this deduction, but may be eligible for the Hope credit or the lifetime learning credit. If your education costs are for your job, enter them in Deductions and Credits under Employment Expenses. If they are related to getting a new job, enter them under Education.

Job-related move. See Moving expenses.

Jury duty pay repaid to employer. Some employers pay employees' salaries while they are away from work on jury duty but require that the employees turn over to the company any jury fees they receive. If your company works this way, you can deduct the fees that you pass on to your employer. Enter this in Income under Less Common Income. Be sure to check the box for Jury Duty income.

Glossary: K - O
(A - E) (F - J) (K - O) (P - T) (U - Z)

K

Keogh plans. You can make a tax-deductible contribution of up to 20% of your net earnings from self-employment in a Keogh retirement plan. The plan must be opened by December 31, 2008, and contributions are due by April 15, 2009. You can extend the due date to October 15, 2009, if you file for an extension for filing your tax return. Enter contributions to your Keogh in Income under Business Income and Expenses.

Kiddie tax. This is the popular term for a special tax that imposes the parents' tax rate on investment income in excess of $1,800 earned by dependent children under age 19 and dependent college students under age 24. The first $900 of the child's income is tax-free, the next $900 is taxed at his or her (presumably) low rate. Enter investment income for your children in Income under Less Common Income.

Kidney donor expenses are deductible. Enter them in Deductions and Credits under Medical.


L

LASIK or other vision correction surgery expenses are deductible. Enter your expenses in Deductions and Credits under Medical.

Laundry and dry cleaning expenses for uniforms. See Uniforms.

Lead-based paint removal. You can count as a deductible expense the cost of removing lead-based paint if the paint is within the reach of a child who has suffered from lead poisoning. Enter your costs in Deductions and Credits under Medical.

Legal fees. You can deduct legal fees related to producing or collecting taxable income or getting taxed. Enter your legal fees in Deductions and Credits under Other Deductions and Credits.

Legal fees, job-related. Legal fees connected with your job, such as fees associated with reinstatement of a medical license, are deductible. Enter your fees in Deductions and Credits under Employment Expenses.

Lifetime learning credit. This credit picks up where the Hope credit ends. It applies to tuition for the junior and senior year of college, graduate level courses, and continuing education courses. The credit is 20% of the first $10,000 of tuition, for a maximum of $2,000 per tax return. For 2008 returns, this credit phases out once modified adjusted gross income exceeds $58,000 for singles and $116,000 for married couples filing jointly. Enter your education expenses in Deductions and Credits under Education.

Loan prepayment penalties. You can deduct any penalties your lender charges you for prepaying your mortgage early. Enter it in Deductions and Credits under Your Home.

Long-term care insurance. You can deduct part of your long-term care insurance expenses. The maximum annual deduction is based on your age, ranging from $310 for those age 40 or younger, to $3,850 for those older than 70. Enter your expenses in Deductions and Credits under Medical.

Loss on an IRA. If you have a loss on your traditional IRA or Roth IRA, you can deduct it as a miscellaneous itemized deduction. Note that you have a loss only if you close all of your traditional IRAs or all of your Roth IRAs and the total distributed to you is less than the total of nondeductible contributions made to the account. Enter your IRA loss in Deductions and Credits under Other Deductions and Credits.

Luxury car rule. This limits annual depreciation deductions for cars and other vehicles used in business. See Expensing SUVs and Expensing pickups for exceptions.


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Malpractice insurance premiums are deductible. Enter them in Deductions and Credits under Employment Expenses.

Margin interest. See Investment interest.

Meals and entertainment. You can deduct 50% of the cost of meals and entertainment related to your job. Sorry, but you can't deduct dues to a golf or country club. Enter your costs in Deductions and Credits under Employment Expenses.

Meals and lodging for overnight trips for charity. You can deduct the cost of unreimbursed meals and lodging you paid while on an overnight trip for a charity. Enter your costs in Deductions and Credits under Donations powered by ItsDeductible(R).

Medical exams required by your employer are deductible as an employee business expense. Enter them in Deductions and Credits under Employment Expenses.

Medicare Part B premiums are deductible. Enter them in Deductions and Credits under Medical.

Medicare Part D premiums are deductible. Enter them in Deductions and Credits under Medical.

Medicine. You can deduct what you pay for any prescription medicines and insulin. You can't deduct the cost of over-the-counter medicines (although the cost can be covered with pre-tax dollars funneled through a medical reimbursement account).. Enter the unreimbursed cost of your prescriptions in Deductions and Credits under Medical.

Military reservists. If you travel more than 100 miles away from home in connection with Armed Forces reserve duties that require an overnight stay, you can deduct food, lodging, and transportation costs as an adjustment to gross income, rather than as an itemized deduction. Enter your reservist expenses in Deductions and Credits under Employment Expenses, and be sure to check the box for Military reservist travel expenses.

Mobile home. If you bought a mobile home in 2008, you may be able to deduct the sales tax you paid. Enter your information in Deductions and Credits under Taxes Paid.

Mortgage interest. You can deduct interest on up to $1.1 million of loans used to buy or build or improve your first or second home. Up to $1 million of such debt is called acquisition debt, which must be used to acquire or improve the property, and up to $100,000 more is called home equity debt, which can be used for any purpose. Enter your mortgage interest and home equity loans in Deductions and Credits under Your Home.

Mortgage interest credit. If you received a mortgage credit certificate from a state or local governmental agency, you can claim a tax credit of up to $2,000 of mortgage interest paid. Enter your mortgage certificate information in Deductions and Credits under Your Home.

Moving expenses. If your move is connected with taking a new job that is at least 50 miles farther from your old home than your old job was, you can deduct the cost of moving your household goods, as well as travel and lodging expenses for you and your family. If you moved to take your first job, the 50-mile test applies to the distance between your old home and your new job. You can take this deduction even if you don't itemize. Enter your moving expenses in Deductions and Credits under Other Deductions and Credits.


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Nanny tax. See Household employees.

Newborns. A child born any time during the year - as late as New Year's Eve - qualifies the parents to claim both a $1,000 child tax credit and a $3,500 dependency exemption. Although the credit amount you receive could be subject to certain limitations, TurboTax will calculate your credit automatically. Enter your newborn's information in the Personal Info tab in the Dependents category.

Noncash contributions. You can deduct the full fair-market value of assets that you've donated to charity. You must have owned the assets for more than a year to qualify. If you give property with a total value of more than $500, you'll need to file Form 8283 and give details about the assets, including a description of them and their individual values. If their value is more than $5,000, you generally will need to attach an appraisal, unless you give listed securities. Note that if you donate used clothing or household items such as furniture, appliances, linens, or electronics, you can't deduct the value of the items unless they are in excellent or good condition. Enter your donations in Deductions and Credits under Donations powered by ItsDeductible(R). Enter the cost of appraisals under Other Deductions and Credits.

Non-prescription drugs. Over-the-counter medicines are not deductible. However, if you have a medical reimbursement plan at work, you can pay for such medicines with reimbursement plan money, whether or not they are recommended by a doctor. You can also pay for herbal remedies, as long as they are recommended by a doctor.

Nonqualified stock options. Options to purchase company stock that are granted to employees as compensation but do not meet restrictions necessary to qualify as incentive stock options. (See Incentive stock options.) There is no tax consequence when the options are granted but when employees exercise the options to purchase stock, the "spread" or "bargain element" - the difference between purchase price and the stock's value - is taxed as additional compensation.

Nursing homes. The full cost of living in a nursing home is deductible if the primary reason the person is there is the availability of medical care. Enter nursing home fees in Deductions and Credits under Medical.

Nursing services. You can deduct wages and other amounts you pay for nursing services, including Social Security taxes you pay on the caregiver's wages. Enter them in Deductions and Credits under Medical.


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Organ donor expenses are deductible. Enter them in Deductions and Credits under Medical.

Out-of-pocket contributions. Expenses you incur while working for a charity - from the cost of driving your car (at 14 cents a mile) to the cost of stamps for a fundraiser - can be included in your charitable contribution deduction. Enter your vehicle mileage and out-of-pocket expenses in Deductions and Credits under Donations powered by ItsDeductible(R).

Oxygen. You can deduct the cost of oxygen and oxygen equipment used to relieve breathing problems caused by a medical condition. Enter your costs in Deductions and Credits under Medical.

Glossary: P - T
(A - E) (F - J) (K - O) (P - T) (U - Z)

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Passport. You can deduct the cost of acquiring a passport for a job-related trip. Enter your costs in Deductions and Credits under Employment Expenses.

Patent donations. If you donate a patent to charity, you can deduct the value of the patent, plus a percentage of the income that the charity earns on the patent for a period of up to 10 years. Enter the original patent donation in Deductions and Credits under Donations powered by ItsDeductible(R). Enter the income the patent earns in Income under Less Common Income. Enter the donation of that income in the Donations powered by ItsDeductible(R) section of Deductions and Credits.

Performance artists. This is a special tax break for struggling artists. If you work for two or more employers, report annual income of less than $16,000, and incur employee expenses that exceed 10% of your income from performing, you can deduct those expenses without restriction. Enter your expenses in Deductions and Credits under Employment Expenses.

Personal property tax. You can deduct state and local taxes that are based on the value of personal property you own, such as an annual tax on the value of your car. Enter your vehicle registration fees in Deductions and Credits under Cars and Other Things You Own. Enter all other personal property tax you paid, such as tax on boats, motor homes, mobile homes, and airplanes under Cars and Other Things You Own. Enter the real estate taxes you pay on your main home and any vacation or second homes under Your Home.

Pew rents. You can deduct fees you pay to a church for pew rents. Enter them in Deductions and Credits under Donations powered by ItsDeductible(R).

Podiatrist's fees, even if not covered by your insurance, are deductible. Enter them in Deductions and Credits under Medical.

Points. Points you pay to get a mortgage for your principal residence are generally fully deductible in the year paid, even if you convince the seller to pay your points for you. You can't deduct them right away if they are paid as part of a refinancing, though; in that case, you deduct the points over the life of the loan. If you refinanced in 2008 to pay off a previously refinanced loan, be sure to deduct any as-yet-undeducted points from that previous refinancing, unless you refinanced with the same lender. If you used the same lender who helped with the previous loan, the as-yet-undeducted points on the first refinancing are added to the points on the second...and deducted over the life of that loan. Enter your points paid in Deductions and Credits under Your Home. Note that we ask for points paid separately from mortgage interest, so don't add the two amounts together.

Preferred seating at college sports events. If you make a contribution to a university and receive the right to preferred seating at sporting events, you can deduct 80% of the donation. Any amount included for the tickets themselves must first be subtracted from the contribution. Enter your contribution in Deductions and Credits under Donations powered by ItsDeductible(R).

Prepaid tuition plans. These plans basically promise that growth of your investments will keep up with the increases in college tuition. The appreciation is tax-free. Enter withdrawals from these plans in Income under Less Common Income.

Prescription drugs are deductible. Enter them in Deductions and Credits under Medical.

President-declared disaster. If your home was damaged or destroyed in an area that the president declared a disaster area, special rules allow you to choose to deduct your casualty loss in the year it occurred or the previous year, whichever is more advantageous to you. Enter your casualty losses in Deductions and Credits under Other Deductions and Credits.

Prizes and awards. The value of a prize or award is generally taxable, so if you hit the lotto, Uncle Sam is a winner, too. One exception is that certain non-cash employee awards - the proverbial gold watch, for example - can be tax-free.

Property taxes. See Real estate taxes.

Psychoanalysis. You can deduct fees paid for psychoanalysis. Enter them in Deductions and Credits under Medical.

Psychologist. You can deduct fees you pay to a psychologist. Enter them in Deductions and Credits under Medical.


R

Real estate taxes. You can deduct state and local real estate taxes you paid on any number of personal residences or other real property you own. Enter them in Deductions and Credits under Your Home and Rentals and Royalties.

Real estate taxes for non-itemizers. Until 2008, only taxpayers who itemized deductions could deduct their real estate taxes. Taxpayers who do not itemize now can take a limited deduction for state and local real estate taxes by increasing their standard deduction. This is the lesser of the amount of real property taxes paid or $500 ($1,000 for married filing joint).

Real estate taxes when you buy a home. If you bought a home in 2008, check the settlement sheet to see if you reimbursed the seller for property taxes he or she prepaid for a period you actually owned the home. If so, include that amount in your real estate tax deduction for the year. Enter your real estate taxes in Deductions and Credits under Your Home.

Rebates. See Economic stimulus payments.

Receipts for charitable contributions. You must have a receipt acknowledging your contribution for every donation of $250 or more; a cancelled check is not sufficient (for gifts up to $250, a canceled check or some other bank record to back up the gifts is sufficient). The $250 trigger is per gift, not per recipient. If you make monthly $100 contributions to your church, for example, you don't need a receipt, even though the total for the year is $1,200. Enter your donations in Deductions and Credits under Donations powered by ItsDeductible(R).

Recreational vehicle. If your RV has cooking, sleeping, and sanitation facilities, interest on a loan used to buy it can qualify as deductible mortgage interest. Enter the interest for your RV in Deductions and Credits under Your Home. (This deduction does not apply if you are subject to AMT. If this restriction affects you, TurboTax will handle the calculation.)

Refinancing points. Generally, points paid when refinancing are deducted over the term of the loan. But if you refinanced a loan that you previously refinanced, you can deduct in full the as-yet-undeducted points remaining on the prior loan. However, there's a catch. If you refinanced with the same lender, the remaining points must be amortized over the term of the new loan. Enter your points paid in Deductions and Credits under Your Home. Note that we ask for points paid separately from mortgage interest, so don't add the two amounts together.

Rehabilitation credit. If your residence is certified by the government as a historic building, you can claim a tax credit for 20% of the cost of renovating it. The renovation must be substantial and the expenses must be incurred within a 24-month period. Enter your costs in Income in Business Income and Expenses and check the box for Investment credit (building rehabilitation, alternative energy, investment, cooperatives).

Reimbursement plans. An employer-provided child-care or medical-reimbursement plan, often called a flex plan or flexible-spending plan, can allow you to pay medical and/or child care bills with pre-tax money. Enter your child care expenses in Deductions and Credits under You and Your Family. Enter your medical expenses in Deductions and Credits under Medical.

Remainder interests in homes and farms. If you agree to give your home or farm to a charity after a term of years, you can deduct the present value of the charity's reminder interest in the property. Enter this in Deductions and Credits under Donations powered by ItsDeductible(R).

Retirement saver's credit. Taxpayers can save for retirement and earn a tax credit in 2008 and the years ahead. This will increase a taxpayer's refund and reduce the tax owed. The credit amount is based on a taxpayer's filing status, adjusted gross income, tax liability and contributions to qualifying retirement programs. This credit helps offset part of the first $1,000 ($2,000 for married couples) contributed to an IRA, 401(k) or similar workplace retirement plans. It gradually diminishes as income rises and disappears when income passes $26,500 on single returns and $53,000 on joint returns. Taxpayers under age 18 and those claimed as dependents on their parents' returns are not eligible, regardless of their income.

Reverse mortgage. Amounts received under a reverse mortgage - either a lump-sum payment or periodic payments are tax-free. You can't deduct interest that accrues on a reverse mortgage until it's paid, and then only interest on up to $100,000 of debt can qualify. If you paid interest on a reverse mortgage, enter it in Deductions and Credits under Your Home.

Roth IRA. You and your spouse can contribute up to $5,000 of earned income to a Roth individual retirement account. Anyone at least 50 years old by the end of the year can contribute $6,000. Unlike a traditional IRA, you can't deduct contributions to a Roth IRA. However, withdrawals from traditional IRAs are taxable in retirement, while withdrawals from Roth IRAs are tax-free. If you contribute to both a traditional IRA and a Roth, the $5,000/$6,000 contribution limit applies to the combination. Enter your contributions to a Roth IRA in Deductions and Credits under Retirement and Investments.

Roth IRA for college tuition. Because Roth IRA contributions can be withdrawn any time tax- and penalty-free, this retirement savings account can be a powerful college-saving tool. Over 10 years, for example, parents could contribute a total of up to $100,000 to Roth IRAs, and it could all be withdrawn to pay college bills. You could withdraw earnings penalty-free, too, although taxes would be due on that amount, assuming you were under age 59 1/2. Enter contributions to a Roth IRA in Deductions and Credits under Retirement and Investments. Enter withdrawals from a Roth IRA in Income under Retirement Distributions.

Roth IRA payouts for first-time homebuyers. Because the rules for the Roth IRA allow you to withdraw contributions at any time without penalty, the Roth can be a powerful tool for saving for a first home. Say you and your spouse each put $5,000 a year into a Roth for five years. The entire $50,000 could be withdrawn tax- and penalty-free for a down payment and, since the accounts have been opened for at least five years, up to $10,000 of earnings can be withdrawn tax- and penalty-free if used to buy your first home. Enter contributions to a Roth IRA in Deductions and Credits under Retirement and Investments. Enter withdrawals from a Roth IRA in Income under Retirement Distributions.


S

Safe-deposit box fees. You can deduct such fees if you use the box to store taxable income-producing stocks, bonds, or investment-related papers and documents. You can't deduct the rent if you use the box only for jewelry, other personal items, or tax-exempt securities. Enter your safe deposit box fees in Deductions and Credits under Retirement and Investments.

Sales tax paid on leased vehicle. If you leased a vehicle in 2008, you may be able to deduct the sales tax you paid. Enter your information in Deductions and Credits under Taxes Paid.

Sales tax paid on vehicle you bought. If you bought a vehicle in 2008, you may be able to deduct the sales tax you paid. Enter your information in Deductions and Credits under Taxes Paid.

Sales taxes. You can choose to deduct either city and state income taxes you pay or state and local sales taxes. If you live in a state that does not impose an income tax, claim the sales tax deduction. You don't need to keep all your receipts either. The IRS has a handy table with estimates based on your income, family size, and where you live. You can add to the table amount sales taxes paid on cars, boats, aircraft, and other big ticket items. Purchase of such items could lead some taxpayers in income-tax states to pay more sales tax than income tax. Enter the sales tax you paid in Deductions and Credits under Taxes Paid.

Saver's credit. See Retirement saver's credit.

Scholarships and fellowships. Scholarships and fellowships received by degree candidates to cover tuition, fees, books and supplies are generally tax-free. But amounts for room and board are taxable.

Security clearance expenses are deductible. Enter them in Deductions and Credits under Employment Expenses.

Seeing Eye dog and the cost of caring for the animal are deductible. Enter your costs in Deductions and Credits under Medical.

Self-employed health insurance premiums. If you are self-employed and pay health insurance premiums for yourself, your spouse, or dependents, you may be able to deduct the full cost of the premiums, even if you don't itemize deductions. Just keep in mind the deduction is limited to the net amount of income from your business. Enter your health insurance premiums in Income under Business Income and Expenses.

SEPs. Self-employed taxpayers can deduct contributions to a Simplified Employee Pension (SEP). The maximum contribution is the smaller of 20% of your net earnings from self-employment or $46,000. Contributions are due by April 15, 2009, but you can extend the due date to October 15, 2009, if you file for an extension for filing your tax return. Enter your contributions to a SEP in Income under Business Income and Expenses.

SIMPLEs. Small-business owners can choose a SIMPLE plan for their retirement savings, which stands for Savings Incentive Match Plan for Employees. For 2008, deductible contributions are limited to $10,500 ($13,000 if you're 50 or older by year-end) plus 3% of self-employment income. SIMPLE plans generally have to be set up by October 1 of the first year for which you want to make contributions. Enter your contributions in Income under Business Income and Expenses.

Social Security tax, excess withheld. If you hold more than one job during the year, either at the same time or successively, too much social security could be withheld from your pay. Each employer is required to withhold the full 7.65 percent tax from the first $102,000 of wages paid in 2008. But no taxpayer has to pay the full tax on more than the annual limits. If wages from two jobs pushes you over the limit, too much tax will be withheld. You get a credit for the excess when you file your tax return for the year. TurboTax will figure the excess and report the refund on your return.

Specialty camps. Amounts paid for the cost of specialty day camps, such as computer camps or soccer camps, are eligible for child and dependent care credit. Enter your costs in Deductions and Credits under You and Your Family.

Spousal IRA. Generally, to contribute to a traditional or Roth IRA, you must have earned income. But, a working spouse can contribute up to $5,000 of his or her earned income to an IRA for a non-working spouse. The limit is $6,000 if the account owner is age 50 or older by the end of the year. Enter your IRA contributions in Deductions and Credits under Retirement and Investments.

Standard deduction for a dependent. If you have a child whom you claim as your dependent on your tax return, you get their dependent exemption. The child may not claim a personal exemption on his or her tax return, however, the child can still get a standard deduction between $900 and $3,500 on his or her 2008 return, depending on how much money they earn and the source of that income.

Standard mileage rate for business driving. If you drive your own car for business, you can deduct actual costs or, for 2008, 50.5 cents per mile for the first half of the year and 58.5 cents per mile for driving in July through December, plus parking and tolls. If your employer didn't reimburse you the full amount for using your own vehicle for your job, claim the difference as a job-related expense. Enter your vehicle mileage in Deductions and Credits under Employment Expenses.

State college savings plans. State college savings plans, often called section 529 plans, allow you to save money, tax free, to pay for college. Although you can't deduct your contributions on your federal return, many states permit residents to deduct contributions on state returns. If you made any withdrawals from your savings plan, enter them in Income under Less Common Income.

Sterilization. You can deduct the cost of such an operation, including a vasectomy. Enter the cost in Deductions and Credits under Medical.

Stop-smoking program. You can deduct the cost of a program to help you stop smoking. Enter it in Deductions and Credits under Medical.

Student health fees. Colleges and private schools sometimes include fees for student medical care in their tuition. If you can get a breakdown of what part of the total bill goes to those fees, you can include that amount in your deductible medical expenses. Enter this in Deductions and Credits under Medical.

Student loan interest. You can deduct up to $2,500 of student loan interest paid in 2008, assuming you're not being claimed as a dependent on your parent's tax return. This deduction is available whether or not you itemize. If your parent paid interest on a loan for which you were liable, they can't claim the deduction, but you may qualify to do so. The right to claim this deduction phases out at higher income levels. Enter the student loan interest you paid in Deductions and Credits under Education.

Subscriptions to trade magazines and professional journals are deductible. Enter them in Deductions and Credits under Employment Expenses.

Swimming pools may be deductible if medically necessary and, as with other home improvements, only to the extent that the cost exceeds any addition to the value of your home. Enter your costs in Deductions and Credits under Medical .


T

Tax preparation fees. You can usually deduct tax preparation fees - including the cost of TurboTax - in the year you pay them. Enter this in Deductions and Credits under Other Deductions and Credits.

Tax rebates. See Economic stimulus payments.

Telephone. You can deduct the amount you pay for special equipment to permit the hearing-impaired to communicate over the phone. Enter your costs in Deductions and Credits under Medical.

Television. The cost of a decoder so that a TV picks up closed-caption signals for the hearing impaired is deductible. Enter it in Deductions and Credits under Medical.

Temporary assignment. If you were on a temporary assignment that required you to be away from home for one year or less, you can deduct food, lodging, and other costs that would normally be considered nondeductible personal expenses. Enter them in Deductions and Credits under Employment Expenses.

Tools, including a carpenter's saw, a lawyer's briefcase, or a nurse's medical equipment, for example, are deductible. Enter them in Deductions and Credits under Employment Expenses.

Travel as education. It used to be possible, for example, for a French teacher to deduct the cost of a trip to France to maintain general familiarity with the language and culture. No more. The law now bars the cost of travel deduction when the travel itself is the educational activity.

Travel expenses. If your job takes you away from home overnight, you can deduct unreimbursed expenses such as food, lodging, and transportation. Enter them in Deductions and Credits under Employment Expenses.

Travel expenses to get medical care are deductible. This includes bus fare, subway fare, or ambulance hire. If you drive your own car, deduct mileage, plus parking and tolls. Out-of-town travel counts too. If you stay in a hotel while you're receiving treatment in an outpatient clinic, you can include up to $50 a day for lodging in your deductible medical expenses. The daily dollar limit for lodging is per person. If you travel with a sick child to get medical care, for example, you could deduct up to $100 a day for your lodging expenses. And if you have to stay in a nearby hotel while a child is hospitalized, you may deduct up to $50 a day of your costs. Enter your travel expenses in Deductions and Credits under Medical.

Travel to see your broker. If your trip is just to check on the market, there's no tax deduction. But if you visit your broker to discuss your specific investments, you can deduct 50.5 cents per mile from January through June of 2008 and 58.5 cents per mile for driving in July through December of 2008, plus the cost of parking and tolls. Enter your travel expenses in Deductions and Credits under Other Deductions and Credits.

Tuition deduction. If your income is too high to qualify for the full Hope credit or lifetime learning credit, you can still deduct up to $4,000 of college tuition expenses paid for yourself, your spouse, or a dependent. The deduction is available even if you don't itemize. We'll even optimize your expenses for the combination of Hope credit, lifetime learning credit, and tuition and fees deduction to make sure you get the biggest refund or the smallest tax bill possible. Keep in mind the deductible amount phases out at higher income levels. Enter your education expenses in Deductions and Credits under Education.

Tuition discount plans. If you are an employee of an educational institution that provides a tuition discount for you, your spouse, or your dependents, consider this a tax-free fringe benefit.

Glossary: U - Z
(A - E) (F - J) (K - O) (P - T) (U - Z)

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Underpayment penalty. The penalty is the IRS's not-so-subtle reminder that taxes are due as income is earned, not just on April 15 of the following year. Basically, it works like interest on a loan, with the penalty rate applied to the amount of estimated tax due but unpaid by each of four payment dates during the year. The penalty rate is set by the IRS and can change each quarter. It was 6 percent at the end of 2008. There are several exceptions to the penalty.

Uniforms. You can deduct the cost of uniforms and other special work clothes required by your job that are not suitable for everyday use. You can also deduct the cost of upkeep, including laundry and dry-cleaning bills, for qualifying uniforms. Enter the costs for your uniforms in Deductions and Credits under Employment Expenses.

Union dues are deductible. Enter them in Deductions and Credits under Employment Expenses.


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Vacation home. You can deduct mortgage interest on a second home, just as you can for your principal residence. Enter it in Deductions and Credits under Your Home. You can deduct property taxes on any number of homes. Enter them in Deductions and Credits under Your Home. If you rent the place for 14 days or less during the year, the rental income is tax-free to you. If you rent it for more than 14 days, you must report the income, but also may claim deductions for rental expenses. Enter all of your rental information in Income under Rentals and Royalties.

Vasectomy. The costs for a vasectomy are deductible. Enter it in Deductions and Credits under Medical.

Vehicle donations. See Automobile, donating to charity.

Vehicle expenses. If you're required to use your car for your job, you can deduct either your actual expenses or the standard mileage rate. The standard mileage rate is 50.5 cents per mile for driving in January through June of 2008 and 58.5 cents per mile for driving in July through December of 2008. You can also deduct the cost of parking and tolls associated with the business use of your car. Enter your vehicle information in Deductions and Credits under Employment Expenses.

Vehicle registration fees. If the fee you pay to register your vehicle is based on the vehicle's value, you can deduct it as a personal property tax. Enter it in Deductions and Credits under Cars and Other Things You Own.

Vision correction surgery, such as LASIK, is deductible. Enter it in Deductions and Credits under Medical.


W

Weight-loss program, A weight-loss program is deductible if recommended by your doctor as part of the treatment for a specific medical problem, such as hypertension or obesity. Health club and gym membership dues are not deductible, but separate fees for weight-loss are. The cost of medically required diet foods that exceeds what you'd normally pay for food is also deductible. Enter your costs in Deductions and Credits under Medical.

Wheelchair. You can deduct the cost of a manual or motorized wheelchair. Enter your costs in Deductions and Credits under Medical.

Wig. A wig purchased upon the advice of a physician for the mental health of a patient who has lost hair due to a disease is deductible. Enter your costs in Deductions and Credits under Medical.


X

X-rays are deductible. Enter them in Deductions and Credits under Medical.

add a category of observer doer.

observer- editor, writer, teacher, annalist, management, consultant, counselor

Doer- doctor, laborer, accountant,

What comes naturally? In what situations?

prayer, spiritually poor,

We will not get rid of spiritual poverty without asking the spiritually poor to join in in helping the physically, mentally, and emotionally poor.

When talking about ministry in Aix saying that we prayed for people and gave out meals and worked with Emaeus made me feel like we were restoring the kingdom in all realms here. How can we invite them to do kingdom work if we haven't found it ourselves? Prayer and bible study are both strong. Conversations have their place, but why not have them over a time of serving if we can. Take them along to give away lunches or involve them in the good works that Jesus recreated us for.

I also think it is important to not forget about the reason why and the strength with which we do these works, Jesus. And why they mean something. We need the fullness of Christ's lordship.

People often seek identity in isolation not realizing that identity is found in community.

People often seek identity in isolation not realizing that identity (should be place and not identity and much about who we are can be discovered in) is found in community. -Dom, leadership summit. - Do i agree with this? Yes and no. I think a good quiet time with God helps us to find our place in community. Could add people try to find their identity in community not realizing that their identity is found in God.
I think self focus sounds more arrogant than humble but when it comes down to it if we want to truly love people and serve in the best way possible (ie. be communally pious) we need to know who we are and how we can serve best and longest, and to do that takes reflection on the self in God's presence. We usually can't give what we don't have. A little time spent taking out the log in our own eye will help us to see others more clearly and to love them better. A little personal piety in the right doses can help us to aviod large character flaws and working less effectively (especially in group situations). Taking the times of ebb to reflect and allowing that change to flow out into the world is how we grow.

Peace,
Adam
PS I like your ZZZ's. With a God as big as ours there is so much to say. And although I love that message, learning how to apply it to life would certainly be gladly welcomed.
PSS it reminds me of asking youth group kids for prayer requests and getting only prayer requests for their aunt's friend's friend or anyone other than themselves. And I am thinking that I would love to pray for your grandmom's bingo partner but I also want to pray for you! Don't you realize that there are hundreds of things that you could and should ask for God's help with?!
PSSS Will you explain to your martians what being set apart really means?

We have got to learn that when we serve the poor we are worshiping God.

Mark 9:36-38 (New International Version)
36He took a little child and had him stand among them. Taking him in his arms, he said to them, 37"Whoever welcomes one of these little children in my name welcomes me; and whoever welcomes me does not welcome me but the one who sent me."

Mtt 25
Lord, when did we see you hungry and feed you, or thirsty and give you something to drink? 38When did we see you a stranger and invite you in, or needing clothes and clothe you? 39When did we see you sick or in prison and go to visit you?'
40"The King will reply, 'I tell you the truth, whatever you did for one of the least of these brothers of mine, you did for me.'