Normally, we do not make these requests until we are in the throes of tax season but let’s take a proactive look at steps you can take now via our year-end tax to-do list.
Debt can sure come in handy when buying a major asset like a house or car or managing unexpected expenses. Thankfully, the interest you pay on this debt can often provide a helpful deduction on your tax return. However, the IRS is very specific regarding the situations where interest is or is not deductible. The rules can be quite complex, so a discussion with your tax professional is always a good idea. Here are several typical examples of how the IRS treats interest payments.