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Shift Expenses to Increase Deductions

Shift Expenses to Increase Deductions

When you add up all your itemized deductions on Schedule A, if the total adds up to less than the standard deduction you are allowed to take, you should obviously choose to take the standard deduction. Because some expenses are at least somewhat discretionary – like charitable giving – when you spend money can make all the difference. Say, for example, that you plan to buy a home next year. The deductions for interest, points, and property taxes you will probably qualify to itemize deductions. If that is the case, you may wish to wait until next year to contribute significant sums to your favorite charity, since those expenses can be added to your itemized deductions on Schedule A. In short, if you feel you will not have enough deductions this year to itemize, consider shifting as many expenses as possible into next year so you can hopefully qualify.

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