15 Deductions to Reduce Your Tax Bill
What if you’re overpaying your taxes without even realizing it? Every year, millions of Americans leave billions of dollars in tax deductions unclaimed.
Whether you’re a freelancer, a small business owner, or just someone looking to maximize savings, understanding tax deductions is like unlocking hidden money.
If you’re tired of watching your hard-earned cash disappear every tax season, keep reading. These 15 deductions could help lower your tax bill significantly—and you might not even know you qualify for some of them.
1. Home Office Deduction
What it is: If you work from home, you may be eligible to deduct a portion of your housing costs, including rent, mortgage interest, and utilities.
Why it matters: With remote work at an all-time high, more people than ever can benefit from this deduction. In 2023 alone, 27.6% of U.S. employees worked remotely, and that number is expected to rise.
How to claim it: Your workspace must be used exclusively for business. Choose between the simplified method (standard $5 per square foot, up to 300 sq ft) or the detailed method (actual expenses).
2. Student Loan Interest Deduction
What it is: If you’re repaying student loans, you may be able to deduct up to $2,500 in interest.
Why it matters: With interest rates climbing and student debt surpassing $1.7 trillion, every little bit helps.
How to claim it: You must be legally responsible for the loan, and your modified adjusted gross income (MAGI) must be below $90,000 ($180,000 for joint filers).
3. Medical Expenses Deduction
What it is: If your out-of-pocket medical costs exceed 7.5% of your adjusted gross income (AGI), you can deduct the excess.
Why it matters: Healthcare costs have soared 17% since 2020, leaving many struggling with medical debt.
How to claim it: Save receipts for doctor visits, prescriptions, dental work, and even travel expenses related to medical care.
4. Retirement Contributions
What it is: Contributions to traditional IRAs and 401(k)s are tax-deductible, reducing your taxable income.
Why it matters: A $6,500 IRA contribution could lower your tax bill significantly, especially if you’re in a high tax bracket.
How to claim it: Check IRS limits. In 2025, individuals under 50 can contribute up to $7,000; those 50+ get an extra $1,000 in catch-up contributions.