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Deducting Charitable Gifts – March 2016
Charitable donations usually can be deducted on Schedule A of Form 1040, along with other itemized deductions. You should have the required support materials, in case your charitable deduction is questioned.
Among the itemized deductions on Schedule A of Form 1040, you’ll find “Interest You Paid.” As you get your records together for tax preparation, you should realize that not all interest can be deducted on your return. Interest you paid last year on credit card debt generally isn’t deductible, for example.
When you file your 2015 federal income tax this year, you can take a standard deduction. For 2015, that’s $6,300 for single taxpayers and for married individuals filing separately; $12,600 for couples filing jointly and for certain widow(er)s; and $9,250 for those filing as heads of household. The beauty of taking the standard deduction is that it’s simple: There’s no need to gather information and scant risk of triggering an audit.
August 2015 was a brutal month for stocks. There were constant reports that the Dow Jones Industrial Average (DJIA) was down hundreds of points for the day, even down by 1000 points during one daily trading session. Ultimately, where do you think August 2015 wound up as far as historical comparisons? As bad as the crash of late 2008? Or even the subsequent bottom of early 2009?
As of this writing, major U.S. stock market indexes are extremely volatile. They’re in the negative column for 2015, but that could change by the time this issue goes to press. In any case, it’s likely that stock market values in late 2015 will still be much higher than they were in the dark days of early 2009.
Annual contributions to IRAs, includingRoth IRAs, are now capped at $5,500($6,500 if you’re 50 or older). RothIRA contributions aren’t tax deductible,they’re available only to workers and theirspouses, and they’re off-limits to high-income taxpayers.