How 401k Contributions Help During Tax Season

401k plans are a great way to help reduce a taxpayer’s taxes. In this TaxAssurances YouTube video I give an example of how that works for an individual making $50,000 per year.

Also, here’s a helpful IRS website that provides more information on 401ks and how they help reduce a taxpayer’s tax liability. https://www.irs.gov/retirement-plans/plan-participant-employee/401k-resource-guide-plan-participants-401k-plan-overview 

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You Cannot Deduct Your Commuting Expenses

SONY DSCEvery so often during tax season I get a client that wants to deduct the expense of going back and forth to work on their taxes. They cannot do it. Here is what the IRS says about it:

“You cannot deduct the costs of taking a bus, trolley, subway, or taxi, or of driving a car between your home and your main or regular place of work. These costs are personal commuting expenses. You cannot deduct commuting expenses no matter how far your home is from your regular place of work. You cannot deduct commuting expenses even if you work during the commuting trip.

Example. You sometimes use your cell phone to make business calls while commuting to and from work. Sometimes business associates ride with you to and from work, and you have a business discussion in the car. These activities do not change the trip from personal to business. You cannot deduct your commuting expenses.”

 

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