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  • Writer's pictureAlex Kreis

10+ Common Tax Deductions and Credits for 2024



As physicians gear up for the new year, it's not just about setting resolutions but also about setting the stage for a financially savvy journey.


Let us tell you, what if you could turn tax season into an opportunity? Yes, here are your options - Tax Deductions and Credits.


Tax deductions reduce your taxable income, while tax credits directly lower your tax bill. And understanding them is fundamental for optimizing your tax return and securing financial stability. 


Our upcoming blog is your go-to resource for understanding common tax deductions for 2024 and how tax credits work. Let’s check it out:

What are tax deductions and tax credits?

In simple terms, a tax deduction is an amount subtracted from your taxable income, reducing the total amount of income that is subject to taxation. It's like having a coupon that lowers the price you pay.


Deductions, including the Standard Tax Deductions 2024, lower your tax liability, potentially leading to a higher tax refund or a lower tax bill.


Unlike deductions, which reduce your taxable income, tax credits directly reduce your tax liability. They are like a discount on your taxes, providing a dollar-for-dollar reduction in the amount of tax you owe.

List of Popular tax deductions to claim on your tax return 


Tax season is a hectic time for physicians, after all, they juggle their professional commitments with managing personal finances. However, here are some popular tax deductions to claim on your tax return:



1. Child Tax Credit:

A benefit for families with kids under 17, granting up to $2,000 per child, with $1,600 potentially refundable, helping to lower tax bills for eligible families.

2. Charitable Donations Deduction:

Permits deduction of charitable contributions up to 60% of adjusted gross income, encouraging philanthropy.

3. Medical expenses deduction:

Allows deduction of qualified, unreimbursed medical expenses exceeding 7.5% of income, easing the financial burden of healthcare costs.

4. IRA Contributions Deduction:

Allows potential deduction for contributions to a traditional IRA, depending on factors like income and retirement plan coverage.

5. 401(k) Contributions Deduction:

Contributions directly diverted into a traditional 401(k) from paychecks aren't taxed, aiding retirement savings.

6. Health Savings Account Contributions Deduction:

Contributions are tax-deductible and withdrawals are tax-free for qualified medical expenses, promoting healthcare savings.

7. Saver's Credit:

Offers a credit of 10% to 50% on contributions to retirement plans, supporting retirement savings for eligible individuals.

8. Solar Tax Credit:

Encourages the use of solar energy systems by offering up to 30% of installation costs as a tax credit, supporting renewable energy adoption.

9. Educator Expenses Deduction:

Teachers can deduct up to $300 for classroom supplies, acknowledging their financial contributions to education.

10. Adoption Credit:

A nonrefundable tax credit helps cover qualified adoption costs, maxing out at $15,950 and gradually reducing based on income.

11. Earned Income Tax Credit:

A refundable credit aiding low-income individuals and families, varying from $600 to $7,430 depending on factors like income and family size.

12. Student Loan Interest Deduction:

Allows deduction of up to $2,500 from taxable income for interest paid on student loans, easing the burden for borrowers.

13. Lifetime Learning Credit:

Provides a credit of up to $2,000 for tuition and fees, supporting ongoing education, although it doesn't cover living expenses or transportation.

14. Child & Dependent Care Credit:

Assists working parents by covering a portion of child care costs—up to 35% of expenses—aimed at enabling parents to work.

15. Mortgage Interest Deduction:

Helps homeowners by reducing taxable income by the amount of mortgage interest paid, supporting home affordability.


How do tax deductions and tax credits leverage maximum benefits?

When you incur expenses that qualify for deductions, such as charitable donations or certain medical expenses, you're essentially utilizing  a tax deduction, allowing you to subtract those amounts from your total income before calculating your taxes. These deductions can either be itemized or claimed through the standard deduction.


On the other hand, when you qualify for a tax credit, such as the Child Tax Credit or the Earned Income Tax Credit, the credit amount is subtracted directly from the total tax you owe. Some tax credits are refundable, meaning they can reduce your tax liability to zero and potentially result in a refund if the credit exceeds the taxes owed.


In the End

Figuring out tax deductions and credits might seem tricky, but it's an essential part of financial planning for physicians and individuals alike. Knowing these ideas and using available deductions and credits can really help your finances. If you need more help, ask a tax expert or financial advisor to make sure you're getting the most from these opportunities. 


We offer FREE educational seminars that can help physicians in tax planning. Get financially prepared for the upcoming year's tax deductions by attending our seminars. Book now at -  https://www.pfinancialservices.com/seminar-request


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