 Income tax 2021-2022, other itemized deductions. Get ready to get income to the max, diving into income tax 2021-2022. Most of this information can be found on the Schedule A Instructions Tax Year 2021 on the IRS website at irs.gov, irs.gov. Income tax formula focused on the itemized deductions as opposed to the adjustments to income, otherwise known as the above-the-line deductions or the deductions for adjusted gross income, noting that the itemized deductions need to be greater than the standard deduction in order to benefit from the itemized deduction. Page 1 of the Form 1040, looking at Line 12A, standard deduction or itemized deductions. Here is Schedule A, the itemized deductions, the categories on the left-hand side, total itemized deductions, if greater than as added up the standard deduction, they would flow then back to Page 1, Form 1040, Line 12A. Here are the standard deductions that you want to keep in mind to give an idea to yourself as to whether a client will be itemizing or taking the standard deduction. So increase standard deduction reporting. If you have a net-qualified disaster loss on Form 4684, Line 15, and you aren't itemizing your deductions, you can claim and increase standard deductions using Schedule A by doing the following. So in other words, this is kind of an exception to the rule that we have either the itemized deductions or the standard deductions because we have the casualty losses which are on the itemized deductions area which changed a couple years ago, restricting it a lot. However, you might be able to use it if you have that declared disaster area and in that event, we don't want to just be benefitting people that are itemizing. We want to be able to allow people that are taking the standard deduction to benefit from that kind of disaster loss. So you got this basically kind of exception where you're going to be able to take that loss kind of like on the itemized deductions and be able to pick up the standard deduction as well. So it might be, we have an example problem on that. You could take a look at it just to kind of get a look at what that might look like. That of course would only be applicable if you're in an area, if you're doing taxes for example in an area where a federal disaster kind of took place, then you want to do some research on that stuff and see if you can pick that stuff up if you're expecting to see it on multiple types of returns. So number one, list the amount from form 4684 line 15 on the dotted line next to line 16 as quote, net qualified disaster loss in quote and attached form 4684. Number two, list your standard deduction amount on the dotted line next to line 16 as standard deduction claim with qualified disaster loss and combine the two amounts on line 16 and enter on form 1040 or 1040 SR line 12A. So in essence you're going to combine this one deduction which was normally itemized and the standard deduction getting the benefit of this item even though it's kind of on an itemized deduction form. Standard deduction reporting do not enter an amount on any other line of schedule A. So in that event then you wouldn't be entering anything else on the schedule A because it's not like you've opened up the threshold to be able to take other deductions. So in other words usually you take either the itemized deductions or the standard deductions if the itemized deductions are greater than the standard deduction usually happening by owning a home because then you got the mortgage interest and the taxes on the property taxes. Then you might have some other things that can open up like the casualty loss. I mean like the charitable contributions for example and the state tax deductions for example could kind of open up. However, if you're just taking the itemized deduction of the casualty loss then you're not really opening up all those other kind of things that you might be able to benefit from if you had increased or going over the threshold in order to itemize. So for more information on how to determine your increased standard deductions you can see publication 976 that can be found on the IRS website irs.gov. Net qualified disaster loss reporting. If you have a net qualified disaster loss on form 4684 line 15 and you are itemizing your deductions list the amount from form 4684 line 15 on the dotted line as quote net qualified disaster loss in quote and include with your other miscellaneous deductions on line 16. Also be sure to attach the form 4684. Don't include your net qualified disaster loss on line 50 other itemized deductions. List the type and amount of each expense from the following list next to line 16 and enter the total of these expenses on line 16. If you are filing a paper return and you can't fit all your expenses on the dotted line next to line 16 attach a statement instead of showing the type or amount of each expense. So if you have a long list of expenses then you might say hey see the statement and you might attach the statement to give you that information only the expenses listed next to you can be deducted on line 15 on line 16 for more information about each of these expenses you can see publication 529 that can be found on the IRS website irs.gov gambling losses. So gambling losses include but aren't limited to the cost of non-winning bingo lottery and raffle tickets but only to the extent of gambling winnings reporting on schedule one form 1040 line 8B. So this is the one that we saw on the income side. So if you're dealing with a client that does gambling you might have someone that basically had one win for example and they come in and they're like I got this money I went to Vegas for the first time or something and I got I won this money then you might not have as much as the losses but you could have the losses but it won't come up all the time but you might have other clients that just like to gamble it's something that they like doing and they are more likely to then have some winnings throughout the year and then they're you're going to want to basically collect their losses as well that you can take then as the itemized deductions but they're severely limited one they're going to be they're going to be required to have to take the itemized deductions in order to to get a benefit from them so they'll be needing to itemize and the amount of the losses that you can take will be limited to basically the winnings that you will be receiving so basically someone can ask can I deduct the gambling losses will the general answer is will you not going to get the full benefit from it you can deduct the gambling losses up to the to the point of gambling winnings that you're reported but they're reported on the schedule a which is itemized deductions which you're only going to get a benefit for if they are greater than the standard deduction all of the itemized deductions that is not just the cat not just the gambling casualty and theft losses of income producing property from form four six eight four line thirty two and thirty eight B or form four seven nine seven line eighteen A you could have federal estate tax on income in respect of a decedent federal estate tax there a deduction for amortizable bond premiums for example deductible allowed for a bond premium carry forward or a deduction for the amortizable bond premium on bonds acquired before October twenty third nineteen eighty six and ordinary loss attributable to a contingent payment debt instrument or an inflation index debt instrument for example a treasury treasury inflation protected security deduction for repayment of amounts under a claim of right if over three thousand dollars you can see publication five to five for more details there certain unrecovered investments in a pension and impairment related work expenses of a disabled person so these are some of these items or items you're not likely to see your your for less likely to see as often as some of the other items on the itemized deductions which of course is why they're in this kind of other area we might touch on a couple of them in a software example in a following presentation.