What is a tax deduction?

Answer 1

It is a term for an amount, whether it be determined by its cost, like a medical expense, or some other method (like a child or dependent person being considered as a specific amount), that is allowed to offset otherwise taxable income. A Tax Deduction could also be donations: # A church, synagogue, or other religious organization; # A war veterans' organization or its post, auxiliary, trust, or foundation organized in the United States or its possessions; # A nonprofit volunteer fire company; # A civil defense organization created under federal, state, or local law (this includes unreimbursed expenses of civil defense volunteers that are directly connected with and solely attributable to their volunteer services); # A domestic fraternal society , operating under the lodge system, but only if the contribution is to be used exclusively for charitable purposes; # A nonprofit cemetery company if the funds are irrevocably dedicated to the perpetual care of the cemetery as a whole and not a particular lot or mausoleum crypt.