
Tax season is here again, and with it comes the opportunity to maximize your savings by taking advantage of often-overlooked deductions. Many taxpayers miss these opportunities due to a lack of awareness or outdated information. Tax laws and deductions can change yearly, and 2025 is no exception. This guide reflects the latest updates to help individuals and small business owners maximize this year’s tax-saving opportunities.
1. Home Office Deduction
Why It’s Overlooked: Fear of audits or the misconception that it only applies to large businesses.
How to Spot It: If you work remotely or run a business from home, you may qualify. The space must be used exclusively and regularly for business. Choose between the simplified deduction ($5 per square foot, up to 300 square feet) or the actual expense method, which includes utilities and maintenance costs.
2. Health Savings Account (HSA) Contributions
Why It’s Overlooked: Many assume HSAs are just a savings tool.
How to Spot It: Contributions to an HSA are tax-deductible, even if you take the standard deduction. For 2025, the contribution limits are $4,150 for individuals and $8,300 for families, with an extra $1,000 catch-up contribution if you're 55 or older.
3. Education-Related Expenses
Why It’s Overlooked: Misunderstanding of eligibility criteria.
How to Spot It: If you or a dependent are pursuing education, check for the Lifetime Learning Credit, which offers up to $2,000 annually. Business owners should also look into deductions for job-related training or certification programs that enhance professional skills.
4. Charitable Contributions Beyond Cash Donations
Why It’s Overlooked: Overlooking non-cash donations or failing to keep records.
How to Spot It: Non-cash contributions, such as donated clothing or household items, can be deducted if given to qualified charities. If you volunteer, costs like mileage (14 cents per mile in 2025) and supplies are also deductible.
5. State Sales Tax Deduction
Why It’s Overlooked: Assumption that income tax deductions are always better.
How to Spot It: If you made significant purchases (like a car or major home appliances), the sales tax you paid might exceed your state income tax. Use the IRS Sales Tax Deduction Calculator to determine the better option.
6. Retirement Contributions
Why It’s Overlooked: Confusion between employer-sponsored and personal plans.
How to Spot It: Contributions to traditional IRAs are deductible up to $6,500 in 2025 (or $7,500 if you’re 50 or older). Self-employed individuals should explore the Solo 401(k) or SEP IRA, which offer higher contribution limits.
7. Self-Employment Expenses
Why It’s Overlooked: Gig workers and freelancers may not know what’s deductible.
How to Spot It: Expenses like advertising, software subscriptions, mileage (65.5 cents per mile for 2025), and even part of your cell phone bill may qualify. Keep detailed records and receipts to substantiate these deductions.
8. Medical and Dental Expenses
Why It’s Overlooked: The deduction threshold seems too high.
How to Spot It: If your unreimbursed medical expenses exceed 7.5% of your adjusted gross income, they may be deductible. This includes items like prescription medications, dental work, and even transportation to medical appointments.
9. Energy Efficiency Upgrades
Why It’s Overlooked: Many homeowners aren’t aware of expanded tax credits.
How to Spot It: The Residential Clean Energy Credit covers 30% of the cost of eligible improvements, such as solar panels, heat pumps, and energy-efficient windows. This credit is available through 2032.
10. Business Use of Vehicles
Why It’s Overlooked: Uncertainty about tracking mileage or partial use.
How to Spot It: If you use your personal vehicle for business purposes, you can deduct mileage or actual expenses like gas and maintenance. Use a tracking app to log trips for accuracy.
Tips for Spotting Overlooked Deductions in 2025
Stay Organized: Maintain receipts, logs, and other documentation throughout the year.
Use Tax Software: Tools like QuickBooks can prompt you to input deductible expenses. QuickBooks can help you track expenses and categorize deductions, ensuring you don’t miss out on any potential tax savings.
Consult a Tax Professional: They can help identify deductions specific to your situation, especially if you have unique circumstances or run a business.
Review IRS Publications: Stay up-to-date with IRS guidelines to ensure you’re maximizing your deductions.
Ready for worry-free taxes with Nuve?
At Nuve, we’re committed to helping you maximize your deductions and minimize your tax burden. Whether you need assistance with individual taxes or managing your small business’s tax filings, our team of experts is here to guide you every step of the way. Contact us today to learn how we can make your tax season simple and stress-free.
Disclosure Statement:
The information provided in this blog is intended for general guidance and educational purposes only. It is not a substitute for personalized professional advice. Every individual's financial situation is unique; therefore, you should review your specific needs and consult with qualified professionals, such as certified public accountants or tax advisors, before making any decisions. While we strive to provide accurate and up-to-date information, we do not guarantee the accuracy, completeness, or currency of the content. By using this blog, you acknowledge that you have read and understand this disclaimer, and you agree to use the information responsibly, in conjunction with advice from qualified professionals, to make informed financial decisions.
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