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Beat the Clock on These 6 Soon-to-Vanish Tax BreaksThey say good things come to those who wait. They also say he who hesitates is lost. But when it comes to half a dozen juicy tax breaks, it's the second "they" you should listen to, because he who waits until Jan. 1, 2012, to take advantage of them will be out of luck.

Here are six tax deductions and credits that will expire at year's end -- unless Congress extends them.

1. Energy-Efficient Home Upgrades

Making energy-saving improvements to your home not only cuts down on heating and cooling costs, it also earns you a tax credit. For example, if you add extra insulation in your attic, replace drafty old windows with modern thermal-pane models, or install an energy-efficient heater or air conditioner, you're eligible for a tax credit of 10% of the cost, up to $500. You don't have to attach the manufacturer's certification that the property meets the requirements for the credit to your tax return, but you must maintain records that establish your entitlement. However, if you've claimed this credit for upgrades in past years, you can't do it again: It's a one-time deal.

2. Higher Education Expenses

The above-the-line deduction of up to $4,000 for qualified higher education expenses won't be available after 2011, so you might want to consider prepaying eligible expenses for 2012 if you haven't already reached the cap for this year. Generally, the deduction applies to tuition and fees paid in connection with enrollment at an institution of higher education during 2011 or the first three months of 2012. The maximum deduction is available to taxpayers with adjusted gross incomes of up to $65,000 for singles and $130,000 for joint filers. A deduction of $2,000 is allowed for singles with adjusted gross incomes of up to $80,000, or joint filers with adjusted gross incomes up to $160,000.

3. Adoption Help

The Adoption Credit and Adoption Assistance Program lets adoptive parents claim a credit against their federal tax of up to $13,360 for "qualified adoption expenses" for each adopted child. If an employer pays the expenses, adoptive parents may be able to exclude up to $13,360 from their gross incomes. Both the credit and the exclusion are reduced (phased out) if parents' income exceeds certain limits, says Gail Rosen, a certified public accountant with Gail Rosen CPA. Though new access to the credit expires when the program ends on Jan. 1, the rules allowed the credit to be carried forward over five years, and Rosen doesn't see anything to would indicate that will change.

4. Sales Tax

If you don't pay state and local income taxes -- a common situation for retired public employees or those living in 'no-income-tax' states like Florida -- you have had the choice of using the optional sales tax deduction to cut your federal income tax. After 2011, that option goes away. So if you're planning to buy big-ticket items like a new car in the near future, you might want to push them up into 2011 to get those last deductions, says Rosen.

5. Mortgage Insurance Premiums

It's bad enough that home values nationally are down to their 2003 levels. As of 2012, you won't even be able to take the mortgage insurance premium deduction. 2011 is the last time homeowners with joint adjusted gross incomes of less than $109,000 will be able to deduct the cost of mortgage insurance on a first or second home.

6. Teachers' Classroom Materials

It's something nearly all educators do these days -- buying classroom supplies and paying for them out of their own pockets. For years, K-12 teachers, instructors, counselors, principals or aides who worked in a school for at least 900 hours during a school year could claim an "above the line" deduction for up to $250 of expenses incurred for books, supplies, computer equipment or supplementary materials used in the classroom. Shop now, teachers: Starting next year, that deduction will disappear like kids vanishing from the classroom when the bell rings.

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Cities with the Lowest Tax Rates

The total amount of tax you pay reaches far beyond what you owe the federal government. Depending on where you live, most likely you're required to pay additional taxes, including property and sales tax. The disparity between the amount of tax you pay in a low-tax city and that in a high-tax city can be dramatic. Living in any of these 10 cities could save you a bundle, although the exact amount may fluctuate based on your income and lifestyle choices.

Cities with the Highest Tax Rates

Much ado is made in the press about federal tax brackets, but cities can carry a tax bite of their own. Even if you live in a state that has no income tax, your city may levy a variety of taxes that could eat away the entire benefit of living in an income tax-free state, including property taxes, sales taxes and auto taxes. Consider all the costs before you move to one of these cities, and understand that rates may change based on your family's income level.

Great Ways to Get Charitable Tax Deductions

Generally, when you give money to a charity, you can use the amount of that donation as a deduction on your tax return. However, not all charities qualify as tax-deductible organizations. While there are many types of charities, they must all meet certain criteria to be classified by the IRS as tax-deductible organizations. There are legitimate tax-deductible organizations in many popular categories, such as those listed below.

A Freelancer's Guide to Taxes

Freelancing certainly has its benefits, but it can result in a few complications come tax time. The Internal Revenue Service considers freelancers to be self-employed, so if you earn income as a freelancer you must file your taxes as a business owner. While you can take additional deductions if you are self-employed, you'll also face additional taxes in the form of the self-employment tax. Here are things to consider as a freelancer when filing your taxes.

Tax Deductions for Voluntary Interest Payments on Student Loans

Most taxpayers who pay interest on student loans can take a tax deduction for the expense ? and you can do this regardless of whether you itemize tax deductions on your return. The rules for claiming the deduction are the same whether the interest payments were required or voluntary.

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Don't you meant Mortgage Interest, not mortgage insurance on number 5?

December 11 2011 at 1:04 PM Report abuse rate up rate down Reply

All of the mentioned tax breaks directly affect the middle class. Taxing the rich is not the answer! Government spending cuts are the only answer.

December 11 2011 at 8:50 AM Report abuse rate up rate down Reply

Tom & Jacqui go back to your text books. Don't blame Obama for this!

December 10 2011 at 11:52 PM Report abuse rate up rate down Reply

Keep in mind the $250 deduction for teachers was to adjust income--not off the bill. That works out to a whopping $62.50 for teachers in the 25% bracket. I would guess many teachers are in the 15% bracket. That's $37.50. I won't go too crazy teachers. The deduction you got for laying out some serious money for your classrooms would barely pay for a tank of gas.

December 06 2011 at 10:16 PM Report abuse rate up rate down Reply

I can translate many of these comments: GIMME, GIMME, GIMME, GIMME............stupid Socialists.

December 06 2011 at 8:07 PM Report abuse -2 rate up rate down Reply

Ohhhhhhhhhhhh laawwwdy sounds shaaaty

if you want want make a couple bucks on the side though feel free to join up!


December 06 2011 at 4:20 PM Report abuse +1 rate up rate down Reply
Fred King

i personaly think it is about time to start taxing the rich , we the middle class and retired pay more taxes then the million aires , all of us middle class support the united states government and the only thanks we get from the government is laughted at and more taxes added to our small check we get after all the money we have payed out to taxes already , l really think we are in same shape as russia was in comanism , all they can say is pay out more of your check so they send billions and billions over seas, like our people dont need it , we have children that need more help then the people over seas.

December 06 2011 at 3:49 PM Report abuse -1 rate up rate down Reply
2 replies to Fred King's comment

except that the rich don't have enough money to fund Dem out of control spending............even if they took all of it.

December 06 2011 at 8:04 PM Report abuse -1 rate up rate down Reply

I happen to qualify as rich under Obama's guidelines of income. I pay about 50% of my income in taxes and charitable contributions plus the additional costs imposed on my business by the adoption of mindless regulations by our govt that cost me more every year to operate. Those costs and fees go to finance a bevy of government bureaucrats and their egos. I invite you, Fred, to pay the same tax rate and make the same % of income contributions I do. If all like you did so, we could eliminate our government debt ( Assuming govt froze spending to get votes from those like you)

December 07 2011 at 10:29 AM Report abuse +2 rate up rate down Reply

It is important to cut the US budget deficit, so we should all (including the top 1%) participate in helping to cut the budget deficit.

December 06 2011 at 2:21 PM Report abuse rate up rate down Reply
1 reply to danny51z's comment

When you say all, I agree. As in 100% of the population pays some tax. I don't care if its a dollar. No more "less than 50% pays taxes". Then we'll all be on the same page when it comes to taxes.

December 06 2011 at 2:54 PM Report abuse +1 rate up rate down Reply
2 replies to EDiddy's comment

Actually, it's 47% who pay no federal income tax. However, they still pay other federal taxes deducted from their paycheck every month. Specifically, they pay Social security and Medicare taxes, also known as FICA taxes. They also pay state taxes, such as sales taxes, etc.

Those who pay no taxes are a very small number of the very poor.

December 06 2011 at 5:32 PM Report abuse rate up rate down

alex, they pay those taxes with money WE GAVE THEM.

December 06 2011 at 8:05 PM Report abuse -1 rate up rate down
Pat C

Tom & Jackie: Pull your heads out of your teapots. You think these tax deductions were all enacted by Obama? You think he did away with them all? What exactly about these deductions is "lying and cheating?" Tax deductions are passed by Congress. You elect your local representative and senator. Get a clue, get real, and get off your pathetic anti-Obama soapbox.

December 06 2011 at 1:33 PM Report abuse +2 rate up rate down Reply
3 replies to Pat C's comment
Tom & Jackie

this is just more lying and cheating by the worst president we have ever had GOD.........help us all amen

December 06 2011 at 1:05 PM Report abuse -2 rate up rate down Reply