Most people think tax season is just about paying what you owe and hoping for a small refund. But here's what the IRS doesn't advertise: you might be leaving hundreds—or even thousands—of dollars on the table every single year.
The truth is, taxes aren't just about how much you earn. They're about how much you keep. And there are specific deductions and credits built into the tax code that are designed to put money back in your pocket. You just have to know where to look.
Here are four common expenses that many Americans overpay on—and how you can get some of that money back when you file.
1. State and Local Taxes (SALT) – You Can Deduct More Than You Think
If you own a home or pay state income tax, you're probably familiar with the SALT deduction. But recent changes have made it significantly more valuable.
What it is: The SALT deduction allows you to deduct state and local property taxes, plus either state income tax or state sales tax.
What changed: For tax years 2025 through 2029, the cap on SALT deductions has increased from $10,000 to $40,000 under the One Big Beautiful Bill Act (OBBBA). That's a massive increase that could benefit millions of homeowners, especially in high-tax states like California, New York, New Jersey, and Illinois.
Who qualifies: If you itemize deductions on Schedule A (instead of taking the standard deduction), you can claim this. The deduction begins to phase out when your adjusted gross income (AGI) exceeds $500,000.
How to claim it: You'll need to itemize your deductions using Schedule A (Form 1040). Keep records of your property tax bills and state income tax payments or sales tax paid throughout the year.
Example: A married couple in New Jersey paying $18,000 in property taxes and $15,000 in state income tax can now deduct up to $33,000—far more than the old $10,000 limit.
2. Medical and Dental Expenses – The 7.5% Rule
Healthcare in America is expensive. But if your medical costs exceed a certain threshold, you can deduct the overage.
What it is: You can deduct qualified, unreimbursed medical and dental expenses that exceed 7.5% of your adjusted gross income (AGI).
What qualifies: Pretty much any out-of-pocket medical expense. This includes:
- Doctor and dentist visits
- Prescription medications
- Health insurance premiums you pay yourself (not through an employer)
- Dental treatments and orthodontia
- Vision care, including glasses and contact lenses
- Mental health counseling
- Transportation to and from medical appointments (at 70 cents per mile for 2025)
- Long-term care services
- Certain home modifications for medical needs (like wheelchair ramps)
Who qualifies: Anyone who itemizes deductions and has medical expenses exceeding 7.5% of their AGI.
How to claim it: Track every medical expense throughout the year. Save receipts, insurance statements, and any documentation showing what you paid out-of-pocket. You'll report these on Schedule A.
Real-world example: Let's say your AGI is $80,000. Seven and a half percent of that is $6,000. If you had $10,000 in medical expenses during the year, you can deduct $4,000 ($10,000 - $6,000). That $4,000 deduction reduces your taxable income.
Pro tip: If you know you'll have major medical expenses in a given year (like surgery or extensive dental work), try to schedule other non-urgent procedures in the same tax year to push yourself over the 7.5% threshold.
3. Charitable Donations – Even Small Gifts Add Up
You probably know you can deduct donations to charity. But many people miss the smaller, non-cash donations that can really add up.
What it is: You can deduct contributions you make to qualified charitable organizations. This isn't just cash—it includes clothing, household items, even mileage driven for volunteer work.
What qualifies:
- Cash donations: Any amount you give directly to a qualified charity. Keep bank records or written acknowledgment from the charity.
- Non-cash donations: Clothing, furniture, electronics, books, and household goods donated to places like Goodwill, Salvation Army, or local shelters.
- Mileage for volunteer work: The IRS allows you to deduct 14 cents per mile for driving to and from volunteer activities.
- Out-of-pocket expenses: If you buy supplies for a charity event or pay for postage to mail a donation, those costs are deductible.
What doesn't qualify: Donations to individuals (GoFundMe campaigns for a friend), political organizations, or for-profit schools.
How to claim it: For cash donations under $250, a bank record or receipt is sufficient. For donations over $250, you need written acknowledgment from the charity. For non-cash donations, you'll need to determine the fair market value of the items (what a thrift store would charge for them). Use IRS Publication 561 or donation value guides from major charities.
Real-world example: A family cleaning out their garage might donate:
- Winter coats worth $200
- A working microwave worth $50
- Children's toys and books worth $100
- Plus $500 in cash donations to their local church
- And drive 100 miles for volunteer work ($14 deduction)
That's $864 in deductions that many people never bother to track.
4. Educator Expenses – A Deduction Just for Teachers
If you're a teacher, you have access to a deduction that most taxpayers don't even know exists.
What it is: Eligible educators can deduct up to $300 of unreimbursed expenses for classroom supplies, books, equipment, and professional development courses.
Who qualifies: Kindergarten through 12th grade teachers, instructors, counselors, principals, or aides who work in a school for at least 900 hours during the school year.
What you can deduct:
- Books, supplies, and equipment for the classroom (including COVID-19 protective items)
- Professional development courses
- Computer equipment and software used in the classroom
- Athletic supplies for coaches
- Art supplies for art teachers
The catch: Unlike most other deductions, this one is "above-the-line"—meaning you don't need to itemize to claim it. You can take the standard deduction AND still claim the educator expense deduction.
How to claim it: Use Form 1040 or 1040-SR and enter the amount on the appropriate line (line 11 on Form 1040 for tax year 2025). Keep receipts for everything you buy.
What's new for 2026: The OBBBA made this deduction permanent and removed it from the miscellaneous itemized deduction category. Starting in 2026, educators can deduct up to $300 annually for unreimbursed classroom expenses.
One Critical Thing to Understand
Before you start claiming all these deductions, you need to understand the difference between standard deduction and itemizing.
Standard deduction (2025):
- Single or married filing separately: $15,750
- Married filing jointly: $31,500
- Head of household: $23,625
Itemized deductions: You list out every eligible expense on Schedule A. If your total itemized deductions exceed the standard deduction amount, you should itemize. If not, take the standard deduction—it's simpler and gives you a bigger tax break.
The math: Let's say you're single with $16,000 in itemized deductions (SALT + medical + charity). That's higher than the $15,750 standard deduction, so you'd itemize and save more. But if your itemized total is only $10,000, you'd take the standard deduction instead.
Most people take the standard deduction because it's larger and easier. But for homeowners, high medical spenders, or generous givers, itemizing can save significantly more.
What About Other Deductions People Miss?
Here are a few more that might apply to your situation:
Student loan interest: You can deduct up to $2,500 of student loan interest paid during the year, even if you don't itemize. This is an above-the-line deduction available to most borrowers.
Retirement contribution credit (Saver's Credit): If you're a low-to-moderate income worker contributing to a 401(k) or IRA, you might qualify for a credit worth up to $1,000 ($2,000 for joint filers).
Home office deduction: For W-2 employees, this deduction has been suspended since 2018. However, if you're self-employed (Schedule C), you can still claim it using the simplified method ($5 per square foot, up to 300 square feet) or the regular method.
Job search expenses: For most W-2 employees, these deductions are no longer available at the federal level. However, some states (like California and New York) still allow them on state returns.
The Bottom Line
Nobody likes paying more taxes than they have to. But every year, millions of Americans overpay simply because they don't know what deductions are available to them.
The four deductions above—SALT, medical expenses, charitable donations, and educator expenses—are some of the most commonly missed. But they're also some of the easiest to claim.
Your action plan:
- Keep receipts and records for every potential deduction throughout the year
- Use tax software or work with a professional to determine whether itemizing makes sense for you
- Don't assume you don't qualify—run the numbers
- File electronically and choose direct deposit for the fastest refund
The IRS isn't going to tell you what you're missing. That's your job. But now you know where to look.
Disclaimer: This article is for informational purposes only and does not constitute tax advice. Tax laws change frequently, and individual situations vary. Consult a qualified tax professional for advice specific to your circumstances.