While talk of tax reform continues, reducing what you pay on your 1994 return is a do-it-yourself job.
Here are some changes you'll encounter in two familiar categories of deductions.- CHARITABLE CONTRIBUTIONS. If you gave any charity a single gift of $250 or more, you must have a receipt to claim a deduction. A canceled check won't do.
If you made a donation of more than $75 and got something in return - say, a fund-raising premium or an auction item - the charity has to tell you the item's value and remind you that you can write off only the difference.
Despite lawmakers' concern about undeserved deductions, you probably don't claim all the charity write-offs you should. The most often overlooked are out-of-pocket expenses incurred while doing charitable work.
Deductible expenses include parking fees, tolls, stamps, long-distance phone calls and 12 cents a mile for using your car.
- MOVING EXPENSES. There's good news both for workers who moved to take their first job and for highly paid executives who transferred during 1994.
The tax break for job-related moving expenses is no longer an itemized deduction. Now it's an adjustment to income claimed on the front of the Form 1040.
That's good for the 70 percent or so of all taxpayers who claim the standard deduction rather than itemizing, including many college grads who move to take their first jobs. You still get the full standard deduction, and you can write off qualifying moving expenses.
For highly paid employees, moving the write-off from Schedule A means it can't be squeezed by the rule that dilutes the value of deductions for taxpayers whose adjusted gross income exceeds $111,800.
But the new rules limit what can be deducted. Your move has to be related to taking a new job at least 50 miles farther from your old home than your old job was.
(If you moved to take your first job, the mileage test applies to the distance from your old home to your new job location.)
You can deduct reasonable costs for getting your family and household goods to the new location. That includes travel and lodging expenses, including nine cents a mile if you drive your own car.
You can no longer count the cost of meals on your trip, pre-move house-hunting costs or any of the home buying or selling expenses that used to be deductible.