Adjustments to Income
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What is an adjustment to income?
• Expenses paid by the taxpayer that lowers taxable income and therefore has the potential to lower their tax liability
• Adjustments to income vs itemized deductions
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Intake and Interview Form
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Page 1 Form 1040
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Student Loan Interest• 1098-E (not everyone receives one from lender)• $2,500 max claimed• MFS cannot claim deduction• Cannot be a dependent
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Educator Expenses• Expenses need to be documented• Must be a Teacher, Instructor, Counselor,
Principal, or Aide• Kindergarten-grade 12• $250 deduction per educator
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Tuition and Fees • Cannot be used in conjunction with the American
Opportunity Credit or Lifetime Learning Credit. o If they are eligible for a education credit and a deduction, enter the
information both ways to see if the deduction or the credit is more beneficial
• MFS cannot take the deduction• Cannot be a dependent
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IRA Contribution Deduction
• For clients who are making contributions to their traditional or Roth IRA.
• Maximum deductionso $5,500 under 50 years of ageo $6,500 over 50
• MFS with income over $10,000 cannot take the deduction
• Income limitso People making over $60,000, please see publication 590 for more rules
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