How To Make The Most Of Your Tax Deductions As A Senior

Being able to maximize tax credits and deductions is essential, especially with inflation impacting all industries. Seniors attempting to file their taxes may not realize the resources and deductions available to them. Below are several tax deductions and credits seniors can take advantage of when filing their taxes. 

Filing Threshold Difference

As a senior citizen, there is a difference in the filing threshold that other citizens experience once they reach 65. If social security is the only income a senior receives in 2022, they only need to file if the income is over $14,700. Each year, these thresholds slightly increase, so it is essential to stay updated annually through the IRS or with a tax preparer to determine if they should be filing. 

Medical Expenses

Maintaining good health is important to the senior community, so like other taxpayers, it is essential to keep those receipts from visits to the doctor and dentist throughout the year. When it is time to file taxes, these receipts can add up as a health deduction and give seniors a credit for federal taxes. These expenses would be filed under itemized deductions. Keep in mind that anyone taking advantage of these deductions will need to prove they have current healthcare, including Medicare or other plans. 

Deductions For Charity

Charitable donations are given to organizations throughout the year and this is true of seniors. Those who have always provided donations to these organizations may not realize that there is a tax benefit for that. According to the IRS, seniors have the ability to lower their annual tax burden by making charitable donations throughout the year and then claiming them on their income taxes when they are being filed. These charitable donations can be provided through cash, property, and even donated through IRA contributions, which allows seniors to be more flexible. It is also easy to file, just provide the tax preparer with a 1099-C that outlines the contribution. 

Contributions From Retirement

Whether someone is completely retired or semi-retired, having an active retirement account means that contributions can be made without any tax penalty. These accounts can include the traditional IRA, Roth IRA, 401k, and others. Seniors can ease their tax burden by recording the contributions that were made to these retirement plans when they are itemizing their deductions. Depending on how much was contributed from the income, the amount of taxes owed could decline significantly. 

Elderly/Disabled Tax Credit

Some seniors have experienced hardships that have rendered them disabled. With the proper documentation, those seniors have the ability to utilize the elderly/disabled tax credit. This is meant to protect those who have either met the 65-year age or have retired and received total disability. Currently, that credit, when applied with other deductions, can range between $3700 and $7500. 

With a variety of resources available, Senior Helpers Lincoln, Yuba City is available to provide resources and information that you or a loved one may need. Contact us today for more information. We proudly serve citizens in the Lincoln, Newcastle, Rio Oso, Sheridan, Wheatland, Marysville, Olivehurst, and Yuba City areas.