Tax Deductions You Can't Claim

A deductible expense is one you can subtract from your taxable gross income, reducing your tax liability. Certain expenses are always deductible, while others can never be deducted.

Most common non-deductible expenses:

• Burial, funeral, and cemetery expenses

• Capital expenses

• Car licenses

• Marriage licenses

• Pet tags and registration fees

• Rent payments

• Travel expenses for another person

• Personal disability insurance premiums

• Personal living or family expenses

• Late payment charges by a public utility

• Federal income taxes

• Adoption expenses (but they might qualify you for the Adoption Tax Credit)

• Investment seminar and convention expenses

• Wages never received

• Lost vacation or sick time

• Voluntary unemployment benefit fund contributions

• Lost or misplaced cash or property

• Losses from the sale of your home, furniture, car, or other personal property

• Check-writing fees on a personal checking account

• Membership dues for any club organized for business, pleasure, recreation, or other social purpose (this does not include professional societies)

• Cost of transportation between your home and your main or regular place of work

• Fines or penalties paid to the government for violating a law

• Health club expenses, even if your are required to stay in shape for your job

• Homeowners' insurance premiums

• Home security systems, assuming you do not have a home office in your home

• Expenses related to attending a convention, seminar, or similar meeting for investment purposes

• Life insurance premiums, unless they are part of an alimony payment

• Lobbying expenses to influence legislation, to participate in any political campaign for or against a candidate, to influence the public in regard to elections, legislative matters, or referendums, or to communicate directly with branch office officials to influence official actions

• Relief fund contributions

• Lunches with co-workers, except while away on business

• Expenses related to meals necessitated by working late unless you are out of town or it is part of entertaining clients

• Legal expenses associated with gaining custody of your children

• Legal expenses associated with civil or criminal charges resulting from a personal relationship

• Fines and penalties you have to pay in damages in a personal injury suit

• Legal fees associated with preparing a will

• What you have to pay in a divorce settlement

• Contributions made to a political candidate, campaign committee, or newsletter fund

• Accounting certificate fees for the initial right to practice accounting

• Bar exam fees and other incidental expenses in obtaining admission to the bar

• Medical and dental license fees to obtain initial licensing

• Professional reputation improvement expenses

• Contributions made to a coworker who can not work due to illness or job-related injuries

• Basic local telephone service charges for the first telephone line to your residence, regardless of whether it is used for business

• Expenses associated with producing tax-exempt income

• Interest on a debt incurred to purchase tax-exempt securities

• Clothing for work that is not worn as a condition of employment or is suitable for everyday wear

• Wristwatches (even if related to a job requirement)

• Annual fees on personal credit cards

• Finance charges on credit cards, installment contracts, and revolving charge accounts incurred for personal expenses

• Most estate, inheritance, legacy, or other succession taxes

• Gift taxes

Do you still have questions about deductible vs non-deductible expenses? Give us a call, we can help.