December 30, 2025 • 19 mins
In this episode of the Teaching Tax Flow podcast, hosts John and Chris usher in the New Year with invaluable insights into commonly missed tax deductions. Dubbing it a conversation you "may not want to admit is a problem," the discussion promises to shed light on often overlooked opportunities within your tax return, aiming to empower listeners with newfound tax knowledge ahead of their 2025 tax preparations. Whether navigating through state and local tax (SALT) deductions or understanding the minutiae of medical miles, this episode is a treasure trove of tax strategy.
Throughout the episode, Chris emphasizes the importance of being proactive and informed about lesser-known deductions. The engaging dialogue reflects on key opportunities such as the state sales tax deduction for non-income tax states, and deductions related to medical miles, charitable miles, and student loan interest. For business owners, the conversation delves into the necessity of capturing deductions like startup costs, home office deductions, and retirement plan contributions. Chris also offers a critical look at rental property tax implications, discussing depreciation, passive activity loss carry forwards, and the Qualified Business Income (QBI) deduction.
KEY TAKEAWAYS
✅ State and Local Tax Savings - Beyond high-tax states, residents in non-income tax states can benefit from state sales tax deductions, particularly on significant purchases.
✅ Medical and Charitable Miles - Deductions are available for medical-related travel and miles driven for charitable work, offering additional savings avenues.
✅ Business Deductions - From startup costs to retirement plan contributions, business owners have multiple opportunities for tax savings that are often overlooked.
✅ Rental Properties - Depreciation and passive activity loss carry forwards are crucial yet frequently missed savings on rental properties.
✅ Engagement with the Community - The episode underscores the value of community engagement through platforms like the Defeating Taxes group for personalized tax insights.
⸻
Episode Sponsor:
Strategic Associates, LLC
Roger Roundy
www.linkedin.com/in/roger-roundy-86887b23
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- (00:00) - Commonly Missed Tax Deductions and Financial Goals for 2026
- (04:04) - Maximizing Tax Deductions Through Strategic Itemization
- (08:29) - Commonly Missed Tax Deductions for Individuals and Business Owners
- (14:41) - Maximize Rental Property Tax Deductions and Avoid Common Mistakes
- (17:50) - Year-End Tax Tips and Future Planning Strategies
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
John Tripolsky (00:04):
Hey everybody, and welcome back to the Teaching
Tax Flow podcast, episode 168.We're diving directly into
something that you may not wantto admit is a problem with your
tax life. What we're getting athere is we're gonna look at
those commonly misseddeductions. So kind of that
famous line, right, is you don'tknow what you don't know. Well,
after this one, hopefully, youhave no excuse for this.
(00:26):
Chris Picciurro my cohost hereas always. Chris, I'm excited to
dive into these because I thinka lot of them we may even know
about and just kind of forgetabout year over year. Right?
Chris Picciurro, CPA (00:37):
Well, now because you listened to this
podcast, maybe you listened toit the day it came out right
before the New Year. You mighthave been toasting on New Year's
Eve with your friends andbragging about your knowledge on
tax planning and strategy andsaying, guess what? Happy New
Year. I'm tipping my glass ofchampagne. Maybe maybe it's
(00:57):
grape juice.
You know? Who knows? We used tohave when I was a kid, New
Year's was a big big deal withfamily, so we would have grape
juice for the kids and thepeople that don't like to
partake in champagne. And nowwhen you when you have that at
your at your party, John, youcan brag your friends and say, I
have educated myself about themisdeductions, and I'm when I
(01:21):
have the tax term prepared formy 2025 return or if I self
prepare it, I'm not gonna missthese. So yeah.
So we're we're giving back tothe community. In all
seriousness, if you'relistening, watching, happy New
Year. If you're watching onYouTube, we wanna know what
what's I don't like resolutions,John. My own personal opinion.
(01:45):
What are your goals?
What's one thing tax or financerelated you wanna accomplish in
2026? And, we'd love to hearfrom you. We've had a lot of
great interaction in our privateFacebook group, defeating taxes.
And a lot of times, some ofthese topics that we talk about
here on the podcast come fromthat group. So let's into
(02:07):
misdeduction.
Anyone having FOMO?
John Tripolsky (02:10):
And I know that we you know, even just the
topics that we choose for thesepodcasts. Right? I know we have
a lot of listeners. We knoweverybody listens to every
single one of these. Right?
We've been doing this for awhile. So every week, and
obviously, one sixty eight. Soyou can do the math. We've been
doing this for a bit. So I thinkwe've kinda figured this out.
And I know we always strugglewith, you know, which topic are
(02:30):
we gonna do for the very lastone of the year. Right? Because
people are busy. They're runningaround. And this one, think, is
very fitting because it's notlike you have to take with
everything.
You don't have to take a lot ofaction, like, the second you
listen to this. You just kindahave to know they exist for the
most part. And I I'm lookingover my camera at a quote that's
on my board that's always insight line for me. It says, I
(02:54):
can't read who it's from, but itsays procrastination makes easy
things hard and hard thingsharder. Mhmm.
So if somebody's procrastinatingon understanding what some of
these are, learn it now, not theday before a tax deadline.
Chris Picciurro, CPA (03:09):
Right? Exactly. It causes And
John Tripolsky (03:12):
that's why we're here.
Chris Picciurro, CPA (03:12):
Stress is expensive. And I wanna say thank
you to everyone in the defeatingtaxes private Facebook group. We
recently had a poll. I thinkwe're keeping it up there a
little bit. What topics do youwanna hear about?
We've had some some people inthe community add their own
topics. We're seeing your votes,and and we're gonna we're gonna
address those topics as well. Solet's talk about commonly missed
(03:35):
deductions. Let's start withindividuals, John. The first
thing now with o b three, right,the one big beautiful bill act,
we know that the SALT taxdeductions, state and local
income tax, that deductionmaximum increased significantly.
There are some income phaseouts, and we typically think of
people that are in those highertax states. You know, the states
(03:56):
on Santa's bad tax list,California, New York, New
Jersey, Illinois, Wisconsin,Minnesota, etcetera, etcetera.
Oh, yeah. Massachusetts. Don'tworry.
We see you. Georgia, you'resneaky too. But the non tax
states, meaning we don't havestate income tax, Tennessee, the
Florida's, the Texas, states,well, you could still deduct
(04:19):
some state income tax, and thisis commonly missed. State sales
tax deductions. So if you, so soif you have, if you purchase a
new vehicle, a boat, orsomething big that you pay the
state sales tax on, that'sdeductible on schedule a if you
itemize.
You can also take a standard, orsimplified state sales tax
(04:42):
deduction based on your incomeand what county you live on live
in as well. So don't miss thestate sales tax deduction if you
itemize even if you're in a,what we call, nontax state. If
you itemize and you deductmedical expenses, we know that
medical expenses have to exceedseven and a half percent of your
income to be deductible. It's anitemized deduction. We've have
(05:03):
another podcast episode onhealth savings accounts and
strategies to make these medicalexpenses deductible.
But remember, medical dry ah,medical miles driven are
deductible for $20.25. That's21¢ per mile. So, John, like,
for instance, let's say you haveto go to, physical therapy for a
(05:23):
few months, or let's say youlive in a more rural area and
you drive a bit to get to yourdoctor. You know, that's that's
very common. Or you have to seea specialist.
You could definitely like, wehave clients that, that drive
quite a bit to the doctor. Youyou could have
a taxpayer that lives maybe uptwo hours away from the from a a
(05:45):
specialist, and they're drivinga significant amount of miles to
get there. Definitely take that21¢ per mile deduction.
John Tripolsky (05:51):
And quick question too. And, yes, that I'm
so glad you you brought that oneback up because I was really
surprised in that when you whenwe did the podcast on that
topic. And that's really, andthen I have another question
back to the salt tax reallyquick. I'll get to that. So with
the mileage deduction formedical purposes, I think is a
way to put it, that's really theonly opportunity to deduct
(06:12):
mileage if if it's not aexclusive use or or a vehicle
for business purposes.
Right? I don't I can't think ofany other
Chris Picciurro, CPA (06:21):
Well, there's gonna be another
misdeduction on individuals. Oh.Sure.
John Tripolsky (06:24):
Roll on. We'll get to that one.
Ad Read (06:27):
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John Tripolsky (06:58):
So here's a quick one on the salt tax.
Chris Picciurro, CPA (07:00):
Oh, on the salt tax.
John Tripolsky (07:01):
Yeah. Sorry. Yeah. Let me go back to this one
because I was just thinking ofthis, and I don't know if we
discussed this on that podcast.So I'm sure some people are
listening to this, and they'relike, oh, state and local.
I pay tax on everything. Fuel,you know, I go to Best Buy and
buy something. Is it only forspecific items that you're
paying, state and local, or ifsomebody really wants to get
(07:23):
down to the nitty gritty andsave receipts for every single
purchase throughout a year, theycould tally those up.
Chris Picciurro, CPA (07:29):
Yeah. So say you could you can tally up
your sales tax you paid, or youcould take the, you know, a
simplified number. Okay.Standard number. But, yeah, if
you or you could take thesimplified or standard number
plus if you had a major purchaselike a vehicle, you could take
that sales tax, a boat, thatsort
John Tripolsky (07:46):
of stuff.
Chris Picciurro, CPA (07:46):
That's why it's a misdeduction. It's
commonly forgot.
John Tripolsky (07:49):
So if somebody likes buying everything and
anything on Amazon and theyspend a crap ton every year, get
out your calculator.
Chris Picciurro, CPA (07:58):
Sure. You could run a report.
John Tripolsky (08:00):
Yeah. So miles out my mouth. Clarifying that.
Chris Picciurro, CPA (08:03):
Let's talk about charitable miles.
Charitable miles are anotherdeduction. So a lot of people
donate their time, you know,maybe at a at a a church or a
nonprofit or animal shelter.Maybe they went to HAM Habitat
for Humanity. Well, the miles toand from that volunteer work or
charitable work, you get adeduction for 14¢ per mile.
(08:24):
That can add up significantly.
John Tripolsky (08:26):
I never knew that either, actually. Okay.
Chris Picciurro, CPA (08:29):
And then student loan interest is
deductible. Sometimes peoplemiss that because Mhmm. They're
thinking, hey. I'm not in I'mnot in school anymore. And then
gambling losses.
Remember, gambling losses,there's a major change in 2026.
We're gonna address that inanother podcast episode next
year. But for '25, you coulddeduct your gambling losses on
your personal return up to yourgambling wins as an itemized
(08:52):
deduction on the federal return.Now most states don't honor that
itemized deduction, but, again,that you can deduct losses up to
your wins in 2025 if you itemizeyour deductions.
John Tripolsky (09:04):
And I and for anybody that's listening to this
that's like, oh my gosh. I mustbe the only person that doesn't
know about this. I believe thatwas one of the most popular
reels we've put on YouTube orwhen we did something happen
there where it just took off.
Chris Picciurro, CPA (09:19):
Yeah. So we'll we'll probably do that
during the near the Super Bowltime. We'll probably do that
near the Super Bowl time here.We'll do a special gambling loss
deduction. There's a whole newset of rules for 2026 for that.
John Tripolsky (09:32):
Absolutely. I'm sure a lot of people have more
losses on that specificallybecause it's easier to gamble
now. I mean, all the onlineopportunities and all that. So
Chris Picciurro, CPA (09:41):
Last time I checked, casinos and online
sports wagering, companiesaren't aren't nonprofits. Right?
So sure they're doing alright.That's awesome. About commonly
missed deductions for businessowners.
So this could be a schedule ctaxpayer, self employed, single
member LLC, or disregardedentity, or maybe even an S corp
(10:03):
owner, maybe even a C corpowner. Home office deduction.
Huge miss. I see it all the timewhere people have a legitimate
home office, so it has to beyour your primary place of
business. And let's assume youhave a legitimate home office.
Definitely take that home officededuction now if you're an s
corp or c corp. How you takethat deduction changes versus
(10:25):
being self employed or a a apartner. If anything if you have
a question on home office, dropa comment here. If you're
watching on YouTube, if you'relistening, walking your dog,
going for a walk, a jog, andyou're listening to the podcast
or the video the the audio, jumpinto the defeating taxes private
Facebook group. You can even goto defeatingtaxes.com.
(10:46):
You could post anonymously. Askyour home office deduction
question. We are happy to help.That is the probably the most
most commonly missed deduction.
John Tripolsky (10:55):
And with that one, Chris, I'd almost put the
challenge out there for anybodythat, you know, again, on
YouTube is kind of the platformwhere we post this line. We
still get emails. We still getmessages. Maybe people aren't
comfortable sharing some stuff,but we almost put the challenge
out there. Comment on this videoand and watch the dialogue grow.
Right? So I mean, down toanything. Let us know anything
you, the listener, haveexperienced with a home office
(11:17):
deduction. If you have aquestion on how much or if
something, you know, obviously,your situation is different, but
I would love to know exactlyeven how many people have taken
that deduction. Even if theydon't have a question, just, you
know, put a comment in there andsay, you know, I have since 2002
or something.
Just let us know. I'm kindacurious. So maybe we'll do,
(11:38):
like, a more formal poll, but Iwould love to see, you know, our
YouTube channel kinda blow upwith some comments on that.
Chris Picciurro, CPA (11:44):
So let's talk about startup costs. Those
are deductible. The first $5,000of startup costs are deductible
immediately. You can make anelection. The remaining amount
we amortize or write off overfifteen years.
Business miles, Mosh, the thestandard mileage deduction is
very generous. So you don't haveto deduct the cost of your
vehicle. You could just take thestandard mileage deduction, for
(12:06):
'25 is is over 70¢ a mile.That's very generous. So a lot
of times people have businessmiles that they forget to
deduct.
They're just not thinking aboutit in the course of running
their business. We're let'sstick to a couple more on health
on on health, On businessowners. Health insurance for
self employed people. Remember,I just mentioned that typically
(12:27):
medical expenses are onlydeductible if they exceed 7 and
a half percent of your income.However, if you have health
insurance premiums that you'repaying and you have self
employment income, that isdeductible.
Now it's not deductible againstyour schedule c income, but it's
still deductible, what we callabove the line for adjusted
gross income. I can't tell youhow many times I see that missed
(12:48):
Or the person prepared theirreturn or someone prepared their
return and put this healthinsurance premiums as just a
regular medical expense, and youdon't get the preferential
treatment. Retirement plancontributions. This one's often
missed or forgotten about.Remember, if if you're self
employed, you have until youfile your tax return to make a
(13:10):
sub or solo k contribution.
So that's why a lot of times weintentionally extend your tax
return and give you more time tocontribute for the previous
year. So remember, not alldeductions have to be paid
before December 31, or allexpenses have to be paid before
December 31 to get a deductionfor it. So if you're self
employed and you still wannacontribute to retirement, talk
(13:31):
to your tax professional andmake sure that you are planning
that retirement contribution andunderstand the timing of it.
John Tripolsky (13:40):
And here's a here's a moment of transparency.
Maybe I shouldn't say this. Imean, let's preface this. Right?
Like, I am not the tax guy Chrisis.
Right? I honestly forgot aboutthat.
Chris Picciurro, CPA (13:51):
Mhmm.
John Tripolsky (13:52):
That one being an example for the deadline is
when you file, not December 31.Right. So sorry about that. But
so, yeah, again, anybody that'slistening to this, you're not
the only one that may not knowthat. That I learned through
osmosis, and I hang out withthis guy almost every day, a
friend and colleague.
Right? And I So
Chris Picciurro, CPA (14:12):
So finally, let's talk about rental
property owners. What's commonlymissed? Travel to and from your
rental property, you could havethe mileage reduction. Let's say
you you're performing services.You're meeting tenants.
You're doing handy person work.You're whatever it is. That's
gonna be deductible.Depreciation. This is so
commonly missed.
(14:34):
But it's confusing. Right?Because a lot of times someone
says, well, my property'sappreciating. I don't wanna take
the depreciation deduction.Guess what?
You have to. The depreciationdeduction is very commonly
missed when I look at peoplethat either self prepare to
return or used another taxprofessional. If you missed the
depreciation deduction, take adeep breath, talk to your tax
(14:57):
professional because it's very,it's not easy to fix, but it's
very fixable in, using what'scalled a, form thirty one
fifteen and a four eighty one aadjustment. Basically, you've
gotta change your accountingmethod and and make that
correction, but don't miss thedepreciation deduction on your
rental properties. And a cousinof that is don't miss a step up
(15:17):
in basis on rental property.
So if you, inherit a rentalproperty or if a spouse inherits
a rental property, remember, youhave to step up the basis. We
could talk about that a littlebit with is is missed deductions
for individuals. So if youinherit something, make sure you
catch the step up in basis, andI think we have a whole podcast
episode on that. So focus on it.Remember, if you're listening or
(15:41):
watching, if you've inherited anasset, talk to your tax
professional and make sure youstepped up the basis on that
asset, meaning you got to changeyour cost basis in that asset up
to the fair market value the dayyou inherited instead of the
amount it was purchased for.
Why? Because that's gonna reducethe amount of capital gain tax
you pay significantly. So acouple more on rental properties
(16:06):
as we wrap up. Make sure youdon't forget about your passive
activity losses. We talk aboutnot every tax benefit has to be
this year, but I can't tell youhow many times we have a
taxpayer that has losses from arental property that are
carrying forward on their taxreturns.
So that it it was maybe theirincome was too high to take that
deduction in the current year.So it carries forward as a PAL,
(16:30):
passive activity losscarryforward. That is reported
on a form eighty five eightytwo. Review if you have rental
property, review that. Because alot of times, if you change tax
software, change a tax preparer,you'll miss it.
You know, you you will you willmiss those passive activity loss
carryforwards, and that could bea very valuable deduction in the
future. Then the final one onrental properties is gonna be
(16:53):
qualified business incomededuction, QBI deduction.
Remember, that's up to a 20%deduction. So this is for people
opposite of the passive activityloss people, the people that
have profit from the rentalproperties. If you might qualify
on top of that for the qualifiedbusiness income deduction,
there's a safe harbor for thattoo.
So if you either have lossesfrom your rental property or you
(17:14):
have a significant profit fromyour rental property, review
your tax turn that's gonna be onschedule e, form eighty five
eighty two. I know I gottechnical here, but talk to your
tax professional about that.Don't miss out on those
deductions because a lot oftimes, missed deductions. I got
one more bonus one as far ascapital loss carry for non
individuals. But remember, thosedeductions, they might not
change your tax return in thecurrent year, but they could
(17:37):
significantly change it in thefuture year.
So it's so important to reallylook at those schedules and
review other return. And, John,this kinda inspired me. I think
we should I think we should domore work next year. I'd like I
think we should have some moreYouTube videos to expand on some
of these deductions, not justtalk about them. I might do some
(17:57):
walk throughs of where you'regonna find them on your tax
return.
John Tripolsky (18:00):
Let's do it. Let's absolutely do it.
Honestly, Chris, if I didn'thave to disconnect my mic and
cause all kinds of audioproblems, I'd like mic drop it
for you if anybody knows whatthat means. It's super I had to
end the year with a corny joke.Right?
But, really, I'm gonna make thisso easy for anybody that's
listening to this. We're notgonna give all the detail, but
as far as for topic bullet pointideas, I'm gonna put every one
(18:21):
of these that we talked about inthe show notes, copy and paste
it, see which ones apply to you,and send them to your tax pro.
Literally copy and paste it. Oh,I have a question on this. I
don't know if I got this.
Make it easy. That way you'redone. So we'll end on a
fantastic note this year withthat.
Chris Picciurro, CPA (18:36):
Happy New Year. We appreciate you for
teaching Tax Law community. It'sbecause of you. We do this. It's
a labor of love for both of us.
And and I just wrote down, John,we're gonna have some yeah. I I
like doing a little bit morewalk through of where these
misdirections might be. So
John Tripolsky (18:52):
Let's do it. Let's do it. So, Chris, you
mentioned, everybody, you have afantastic, fantastic '25. And
don't worry. You don't have todo everything before New Year's
Eve.
You got a little bit longer,which we'll talk about tax
extensions again here in thevery near future. Everybody, you
have a great, great rest of theyear and, you know, throwing out
the window our normal close. Wewill see you back here next year
(19:14):
on the teaching tax flowpodcast. Have a great one,
buddy.
Disclaimer (19:21):
The content provided is for educational purposes
only. We encourage you to seekpersonalized investment advice
from your financialprofessional. For all tax and
legal advice, please consultyour CPA or attorney. Investment
advisory services are offeredthrough Cabin Advisors, a
registered investment advisor.Securities are offered through
Cabin Securities, a registeredbroker dealer.
The content of this podcast doesnot constitute an offer of
(19:42):
securities. Offerings can onlybe made through an offering
memorandum, and you shouldcarefully examine the risk
factors and other informationcontained in the memorandum.
Hey everybody, and welcome back to the Teaching
Tax Flow podcast, episode 168.We're diving directly into
something that you may not wantto admit is a problem with your
tax life. What we're getting athere is we're gonna look at
those commonly misseddeductions. So kind of that
famous line, right, is you don'tknow what you don't know. Well,
after this one, hopefully, youhave no excuse for this.
(00:26):
Chris Picciurro my cohost hereas always. Chris, I'm excited to
dive into these because I thinka lot of them we may even know
about and just kind of forgetabout year over year. Right?
Chris Picciurro, CPA (00:37):
Well, now because you listened to this
podcast, maybe you listened toit the day it came out right
before the New Year. You mighthave been toasting on New Year's
Eve with your friends andbragging about your knowledge on
tax planning and strategy andsaying, guess what? Happy New
Year. I'm tipping my glass ofchampagne. Maybe maybe it's
(00:57):
grape juice.
You know? Who knows? We used tohave when I was a kid, New
Year's was a big big deal withfamily, so we would have grape
juice for the kids and thepeople that don't like to
partake in champagne. And nowwhen you when you have that at
your at your party, John, youcan brag your friends and say, I
have educated myself about themisdeductions, and I'm when I
(01:21):
have the tax term prepared formy 2025 return or if I self
prepare it, I'm not gonna missthese. So yeah.
So we're we're giving back tothe community. In all
seriousness, if you'relistening, watching, happy New
Year. If you're watching onYouTube, we wanna know what
what's I don't like resolutions,John. My own personal opinion.
(01:45):
What are your goals?
What's one thing tax or financerelated you wanna accomplish in
2026? And, we'd love to hearfrom you. We've had a lot of
great interaction in our privateFacebook group, defeating taxes.
And a lot of times, some ofthese topics that we talk about
here on the podcast come fromthat group. So let's into
(02:07):
misdeduction.
Anyone having FOMO?
John Tripolsky (02:10):
And I know that we you know, even just the
topics that we choose for thesepodcasts. Right? I know we have
a lot of listeners. We knoweverybody listens to every
single one of these. Right?
We've been doing this for awhile. So every week, and
obviously, one sixty eight. Soyou can do the math. We've been
doing this for a bit. So I thinkwe've kinda figured this out.
And I know we always strugglewith, you know, which topic are
(02:30):
we gonna do for the very lastone of the year. Right? Because
people are busy. They're runningaround. And this one, think, is
very fitting because it's notlike you have to take with
everything.
You don't have to take a lot ofaction, like, the second you
listen to this. You just kindahave to know they exist for the
most part. And I I'm lookingover my camera at a quote that's
on my board that's always insight line for me. It says, I
(02:54):
can't read who it's from, but itsays procrastination makes easy
things hard and hard thingsharder. Mhmm.
So if somebody's procrastinatingon understanding what some of
these are, learn it now, not theday before a tax deadline.
Chris Picciurro, CPA (03:09):
Right? Exactly. It causes And
John Tripolsky (03:12):
that's why we're here.
Chris Picciurro, CPA (03:12):
Stress is expensive. And I wanna say thank
you to everyone in the defeatingtaxes private Facebook group. We
recently had a poll. I thinkwe're keeping it up there a
little bit. What topics do youwanna hear about?
We've had some some people inthe community add their own
topics. We're seeing your votes,and and we're gonna we're gonna
address those topics as well. Solet's talk about commonly missed
(03:35):
deductions. Let's start withindividuals, John. The first
thing now with o b three, right,the one big beautiful bill act,
we know that the SALT taxdeductions, state and local
income tax, that deductionmaximum increased significantly.
There are some income phaseouts, and we typically think of
people that are in those highertax states. You know, the states
(03:56):
on Santa's bad tax list,California, New York, New
Jersey, Illinois, Wisconsin,Minnesota, etcetera, etcetera.
Oh, yeah. Massachusetts. Don'tworry.
We see you. Georgia, you'resneaky too. But the non tax
states, meaning we don't havestate income tax, Tennessee, the
Florida's, the Texas, states,well, you could still deduct
(04:19):
some state income tax, and thisis commonly missed. State sales
tax deductions. So if you, so soif you have, if you purchase a
new vehicle, a boat, orsomething big that you pay the
state sales tax on, that'sdeductible on schedule a if you
itemize.
You can also take a standard, orsimplified state sales tax
(04:42):
deduction based on your incomeand what county you live on live
in as well. So don't miss thestate sales tax deduction if you
itemize even if you're in a,what we call, nontax state. If
you itemize and you deductmedical expenses, we know that
medical expenses have to exceedseven and a half percent of your
income to be deductible. It's anitemized deduction. We've have
(05:03):
another podcast episode onhealth savings accounts and
strategies to make these medicalexpenses deductible.
But remember, medical dry ah,medical miles driven are
deductible for $20.25. That's21¢ per mile. So, John, like,
for instance, let's say you haveto go to, physical therapy for a
(05:23):
few months, or let's say youlive in a more rural area and
you drive a bit to get to yourdoctor. You know, that's that's
very common. Or you have to seea specialist.
You could definitely like, wehave clients that, that drive
quite a bit to the doctor. Youyou could have
a taxpayer that lives maybe uptwo hours away from the from a a
(05:45):
specialist, and they're drivinga significant amount of miles to
get there. Definitely take that21¢ per mile deduction.
John Tripolsky (05:51):
And quick question too. And, yes, that I'm
so glad you you brought that oneback up because I was really
surprised in that when you whenwe did the podcast on that
topic. And that's really, andthen I have another question
back to the salt tax reallyquick. I'll get to that. So with
the mileage deduction formedical purposes, I think is a
way to put it, that's really theonly opportunity to deduct
(06:12):
mileage if if it's not aexclusive use or or a vehicle
for business purposes.
Right? I don't I can't think ofany other
Chris Picciurro, CPA (06:21):
Well, there's gonna be another
misdeduction on individuals. Oh.Sure.
John Tripolsky (06:24):
Roll on. We'll get to that one.
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John Tripolsky (06:58):
So here's a quick one on the salt tax.
Chris Picciurro, CPA (07:00):
Oh, on the salt tax.
John Tripolsky (07:01):
Yeah. Sorry. Yeah. Let me go back to this one
because I was just thinking ofthis, and I don't know if we
discussed this on that podcast.So I'm sure some people are
listening to this, and they'relike, oh, state and local.
I pay tax on everything. Fuel,you know, I go to Best Buy and
buy something. Is it only forspecific items that you're
paying, state and local, or ifsomebody really wants to get
(07:23):
down to the nitty gritty andsave receipts for every single
purchase throughout a year, theycould tally those up.
Chris Picciurro, CPA (07:29):
Yeah. So say you could you can tally up
your sales tax you paid, or youcould take the, you know, a
simplified number. Okay.Standard number. But, yeah, if
you or you could take thesimplified or standard number
plus if you had a major purchaselike a vehicle, you could take
that sales tax, a boat, thatsort
John Tripolsky (07:46):
of stuff.
Chris Picciurro, CPA (07:46):
That's why it's a misdeduction. It's
commonly forgot.
John Tripolsky (07:49):
So if somebody likes buying everything and
anything on Amazon and theyspend a crap ton every year, get
out your calculator.
Chris Picciurro, CPA (07:58):
Sure. You could run a report.
John Tripolsky (08:00):
Yeah. So miles out my mouth. Clarifying that.
Chris Picciurro, CPA (08:03):
Let's talk about charitable miles.
Charitable miles are anotherdeduction. So a lot of people
donate their time, you know,maybe at a at a a church or a
nonprofit or animal shelter.Maybe they went to HAM Habitat
for Humanity. Well, the miles toand from that volunteer work or
charitable work, you get adeduction for 14¢ per mile.
(08:24):
That can add up significantly.
John Tripolsky (08:26):
I never knew that either, actually. Okay.
Chris Picciurro, CPA (08:29):
And then student loan interest is
deductible. Sometimes peoplemiss that because Mhmm. They're
thinking, hey. I'm not in I'mnot in school anymore. And then
gambling losses.
Remember, gambling losses,there's a major change in 2026.
We're gonna address that inanother podcast episode next
year. But for '25, you coulddeduct your gambling losses on
your personal return up to yourgambling wins as an itemized
(08:52):
deduction on the federal return.Now most states don't honor that
itemized deduction, but, again,that you can deduct losses up to
your wins in 2025 if you itemizeyour deductions.
John Tripolsky (09:04):
And I and for anybody that's listening to this
that's like, oh my gosh. I mustbe the only person that doesn't
know about this. I believe thatwas one of the most popular
reels we've put on YouTube orwhen we did something happen
there where it just took off.
Chris Picciurro, CPA (09:19):
Yeah. So we'll we'll probably do that
during the near the Super Bowltime. We'll probably do that
near the Super Bowl time here.We'll do a special gambling loss
deduction. There's a whole newset of rules for 2026 for that.
John Tripolsky (09:32):
Absolutely. I'm sure a lot of people have more
losses on that specificallybecause it's easier to gamble
now. I mean, all the onlineopportunities and all that. So
Chris Picciurro, CPA (09:41):
Last time I checked, casinos and online
sports wagering, companiesaren't aren't nonprofits. Right?
So sure they're doing alright.That's awesome. About commonly
missed deductions for businessowners.
So this could be a schedule ctaxpayer, self employed, single
member LLC, or disregardedentity, or maybe even an S corp
(10:03):
owner, maybe even a C corpowner. Home office deduction.
Huge miss. I see it all the timewhere people have a legitimate
home office, so it has to beyour your primary place of
business. And let's assume youhave a legitimate home office.
Definitely take that home officededuction now if you're an s
corp or c corp. How you takethat deduction changes versus
(10:25):
being self employed or a a apartner. If anything if you have
a question on home office, dropa comment here. If you're
watching on YouTube, if you'relistening, walking your dog,
going for a walk, a jog, andyou're listening to the podcast
or the video the the audio, jumpinto the defeating taxes private
Facebook group. You can even goto defeatingtaxes.com.
(10:46):
You could post anonymously. Askyour home office deduction
question. We are happy to help.That is the probably the most
most commonly missed deduction.
John Tripolsky (10:55):
And with that one, Chris, I'd almost put the
challenge out there for anybodythat, you know, again, on
YouTube is kind of the platformwhere we post this line. We
still get emails. We still getmessages. Maybe people aren't
comfortable sharing some stuff,but we almost put the challenge
out there. Comment on this videoand and watch the dialogue grow.
Right? So I mean, down toanything. Let us know anything
you, the listener, haveexperienced with a home office
(11:17):
deduction. If you have aquestion on how much or if
something, you know, obviously,your situation is different, but
I would love to know exactlyeven how many people have taken
that deduction. Even if theydon't have a question, just, you
know, put a comment in there andsay, you know, I have since 2002
or something.
Just let us know. I'm kindacurious. So maybe we'll do,
(11:38):
like, a more formal poll, but Iwould love to see, you know, our
YouTube channel kinda blow upwith some comments on that.
Chris Picciurro, CPA (11:44):
So let's talk about startup costs. Those
are deductible. The first $5,000of startup costs are deductible
immediately. You can make anelection. The remaining amount
we amortize or write off overfifteen years.
Business miles, Mosh, the thestandard mileage deduction is
very generous. So you don't haveto deduct the cost of your
vehicle. You could just take thestandard mileage deduction, for
(12:06):
'25 is is over 70¢ a mile.That's very generous. So a lot
of times people have businessmiles that they forget to
deduct.
They're just not thinking aboutit in the course of running
their business. We're let'sstick to a couple more on health
on on health, On businessowners. Health insurance for
self employed people. Remember,I just mentioned that typically
(12:27):
medical expenses are onlydeductible if they exceed 7 and
a half percent of your income.However, if you have health
insurance premiums that you'repaying and you have self
employment income, that isdeductible.
Now it's not deductible againstyour schedule c income, but it's
still deductible, what we callabove the line for adjusted
gross income. I can't tell youhow many times I see that missed
(12:48):
Or the person prepared theirreturn or someone prepared their
return and put this healthinsurance premiums as just a
regular medical expense, and youdon't get the preferential
treatment. Retirement plancontributions. This one's often
missed or forgotten about.Remember, if if you're self
employed, you have until youfile your tax return to make a
(13:10):
sub or solo k contribution.
So that's why a lot of times weintentionally extend your tax
return and give you more time tocontribute for the previous
year. So remember, not alldeductions have to be paid
before December 31, or allexpenses have to be paid before
December 31 to get a deductionfor it. So if you're self
employed and you still wannacontribute to retirement, talk
(13:31):
to your tax professional andmake sure that you are planning
that retirement contribution andunderstand the timing of it.
John Tripolsky (13:40):
And here's a here's a moment of transparency.
Maybe I shouldn't say this. Imean, let's preface this. Right?
Like, I am not the tax guy Chrisis.
Right? I honestly forgot aboutthat.
Chris Picciurro, CPA (13:51):
Mhmm.
John Tripolsky (13:52):
That one being an example for the deadline is
when you file, not December 31.Right. So sorry about that. But
so, yeah, again, anybody that'slistening to this, you're not
the only one that may not knowthat. That I learned through
osmosis, and I hang out withthis guy almost every day, a
friend and colleague.
Right? And I So
Chris Picciurro, CPA (14:12):
So finally, let's talk about rental
property owners. What's commonlymissed? Travel to and from your
rental property, you could havethe mileage reduction. Let's say
you you're performing services.You're meeting tenants.
You're doing handy person work.You're whatever it is. That's
gonna be deductible.Depreciation. This is so
commonly missed.
(14:34):
But it's confusing. Right?Because a lot of times someone
says, well, my property'sappreciating. I don't wanna take
the depreciation deduction.Guess what?
You have to. The depreciationdeduction is very commonly
missed when I look at peoplethat either self prepare to
return or used another taxprofessional. If you missed the
depreciation deduction, take adeep breath, talk to your tax
(14:57):
professional because it's very,it's not easy to fix, but it's
very fixable in, using what'scalled a, form thirty one
fifteen and a four eighty one aadjustment. Basically, you've
gotta change your accountingmethod and and make that
correction, but don't miss thedepreciation deduction on your
rental properties. And a cousinof that is don't miss a step up
(15:17):
in basis on rental property.
So if you, inherit a rentalproperty or if a spouse inherits
a rental property, remember, youhave to step up the basis. We
could talk about that a littlebit with is is missed deductions
for individuals. So if youinherit something, make sure you
catch the step up in basis, andI think we have a whole podcast
episode on that. So focus on it.Remember, if you're listening or
(15:41):
watching, if you've inherited anasset, talk to your tax
professional and make sure youstepped up the basis on that
asset, meaning you got to changeyour cost basis in that asset up
to the fair market value the dayyou inherited instead of the
amount it was purchased for.
Why? Because that's gonna reducethe amount of capital gain tax
you pay significantly. So acouple more on rental properties
(16:06):
as we wrap up. Make sure youdon't forget about your passive
activity losses. We talk aboutnot every tax benefit has to be
this year, but I can't tell youhow many times we have a
taxpayer that has losses from arental property that are
carrying forward on their taxreturns.
So that it it was maybe theirincome was too high to take that
deduction in the current year.So it carries forward as a PAL,
(16:30):
passive activity losscarryforward. That is reported
on a form eighty five eightytwo. Review if you have rental
property, review that. Because alot of times, if you change tax
software, change a tax preparer,you'll miss it.
You know, you you will you willmiss those passive activity loss
carryforwards, and that could bea very valuable deduction in the
future. Then the final one onrental properties is gonna be
(16:53):
qualified business incomededuction, QBI deduction.
Remember, that's up to a 20%deduction. So this is for people
opposite of the passive activityloss people, the people that
have profit from the rentalproperties. If you might qualify
on top of that for the qualifiedbusiness income deduction,
there's a safe harbor for thattoo.
So if you either have lossesfrom your rental property or you
(17:14):
have a significant profit fromyour rental property, review
your tax turn that's gonna be onschedule e, form eighty five
eighty two. I know I gottechnical here, but talk to your
tax professional about that.Don't miss out on those
deductions because a lot oftimes, missed deductions. I got
one more bonus one as far ascapital loss carry for non
individuals. But remember, thosedeductions, they might not
change your tax return in thecurrent year, but they could
(17:37):
significantly change it in thefuture year.
So it's so important to reallylook at those schedules and
review other return. And, John,this kinda inspired me. I think
we should I think we should domore work next year. I'd like I
think we should have some moreYouTube videos to expand on some
of these deductions, not justtalk about them. I might do some
(17:57):
walk throughs of where you'regonna find them on your tax
return.
John Tripolsky (18:00):
Let's do it. Let's absolutely do it.
Honestly, Chris, if I didn'thave to disconnect my mic and
cause all kinds of audioproblems, I'd like mic drop it
for you if anybody knows whatthat means. It's super I had to
end the year with a corny joke.Right?
But, really, I'm gonna make thisso easy for anybody that's
listening to this. We're notgonna give all the detail, but
as far as for topic bullet pointideas, I'm gonna put every one
(18:21):
of these that we talked about inthe show notes, copy and paste
it, see which ones apply to you,and send them to your tax pro.
Literally copy and paste it. Oh,I have a question on this. I
don't know if I got this.
Make it easy. That way you'redone. So we'll end on a
fantastic note this year withthat.
Chris Picciurro, CPA (18:36):
Happy New Year. We appreciate you for
teaching Tax Law community. It'sbecause of you. We do this. It's
a labor of love for both of us.
And and I just wrote down, John,we're gonna have some yeah. I I
like doing a little bit morewalk through of where these
misdirections might be. So
John Tripolsky (18:52):
Let's do it. Let's do it. So, Chris, you
mentioned, everybody, you have afantastic, fantastic '25. And
don't worry. You don't have todo everything before New Year's
Eve.
You got a little bit longer,which we'll talk about tax
extensions again here in thevery near future. Everybody, you
have a great, great rest of theyear and, you know, throwing out
the window our normal close. Wewill see you back here next year
(19:14):
on the teaching tax flowpodcast. Have a great one,
buddy.
Disclaimer (19:21):
The content provided is for educational purposes
only. We encourage you to seekpersonalized investment advice
from your financialprofessional. For all tax and
legal advice, please consultyour CPA or attorney. Investment
advisory services are offeredthrough Cabin Advisors, a
registered investment advisor.Securities are offered through
Cabin Securities, a registeredbroker dealer.
The content of this podcast doesnot constitute an offer of
(19:42):
securities. Offerings can onlybe made through an offering
memorandum, and you shouldcarefully examine the risk
factors and other informationcontained in the memorandum.
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