Definition of «tax deduction»

A tax deduction is a reduction in the amount of income that is subject to tax. This means that you can subtract certain expenses or contributions from your total income, which reduces how much you owe in taxes. Tax deductions are often available for things like mortgage interest, charitable donations, and medical expenses. The purpose of a tax deduction is to provide relief to individuals and businesses that incur certain costs, as it helps them to keep more of their earnings.

Sentences with «tax deduction»

  • If you are purchasing the second home to use as a rental property, you may qualify for tax deductions for your expenses. (hrblock.com)
  • If you pay for insurance on behalf of your sister or brother, you can not claim for tax deductions on health insurance. (policybazaar.com)
  • The budget offers a state income tax deduction of up to $ 10,000 for sending a student to private school. (politifact.com)
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