A Practical Guide to Lesser-Known Tax Benefits
Tax season is here, and while you may be familiar with the standard deductions, there are plenty of lesser-known tax benefits that could save you hundreds or even thousands of dollars. Here are five tax deductions you might be missing out on in 2025, along with tips to make sure you’re maximizing your refund this year.
1. Student Loan Interest Deduction
If you’re repaying student loans, you may qualify to deduct up to $2,500 of the interest paid on those loans. This deduction is available even if you don’t itemize your taxes. To qualify, your modified adjusted gross income (MAGI) must fall below the specified limit, which has increased slightly for 2025.
Pro Tip: Check with your loan servicer to get a copy of Form 1098-E, which outlines the interest you’ve paid over the past year.
2. Work-Related Education Expenses
If you’ve taken courses to improve your skills or advance in your career, you might be eligible to deduct the costs of tuition, books, supplies, and even transportation. This tax deduction applies if the education is directly related to your current job and maintains or improves the skills required.
Pro Tip: Keep receipts and enrollment records for any courses you’ve taken to ensure you can claim this tax deduction.
3. Health Savings Account (HSA) Contributions
Contributions to an HSA are tax deductible, and the funds can be used for qualified medical expenses. For 2025, the contribution limits have increased slightly, allowing individuals and families to save more while reducing their taxable income.
Pro Tip: Maximize your HSA contributions to get the most significant tax advantage, and remember, unused funds roll over year to year.
4. Energy-Efficient Home Improvements
Have you made eco-friendly upgrades to your home, like installing solar panels, energy-efficient windows, or insulation? You might be eligible for a tax credit that offsets a percentage of the cost. These incentives have been expanded for 2025 to encourage more homeowners to go green.
Pro Tip: Save invoices and certifications for any energy-efficient products you’ve installed to substantiate your claim.
5. Charitable Donations Through Payroll Deductions
If you’ve donated to charity via payroll deductions, these contributions are tax deductible. This method of giving is often overlooked, but it’s an easy way to support causes you care about while reducing your taxable income.
Pro Tip: Request a summary of your payroll deductions from your employer or use year-end pay stubs to track your contributions.
Bonus Tip: Leverage Salarly’s Payroll-Linked Loans to Improve Financial Wellness
While preparing for tax season, don’t overlook tools that can help you manage your finances better. Salarly offers payroll-linked loans that provide a quick and stress-free way to handle unexpected expenses. These loans are automatically repaid through your paycheck, making it easier to stay on top of your financial obligations without disrupting your budget.
Not only does this help you avoid high-interest alternatives, but responsible borrowing can also positively impact your credit score—an indirect benefit when it comes to tax planning and financial health.
FAQs: Tax Deductions and Salarly Loans
1. What documentation do I need to claim these tax deductions?
For student loan interest, education expenses, and charitable donations, ensure you have official forms like 1098-E and receipts for all qualifying expenditures. For energy-efficient improvements, keep product certifications and invoices.
2. Can I claim tax deductions if I’ve used a payroll-linked loan from Salarly?
Yes! Using a Salarly payroll-linked loan doesn’t impact your eligibility for tax deductions. In fact, these loans can help you cover expenses like education or medical bills that might qualify for deductions.
3. How can Salarly help during tax season?
Salarly makes it easier to manage financial stress during tax season by providing fast, payroll-linked loans. You can use the funds to pay down debt, cover unexpected expenses, or invest in deductible opportunities like education and home improvements. Loans can indirectly support your financial wellness by helping you manage deductible expenses like medical costs or job-related education. Plus, staying on top of repayments with Salarly can positively impact your credit score, which is an added financial benefit.
By exploring these tax deductions and leveraging tools like Salarly, you can maximize your refund and improve your overall financial health in 2025. Don’t let hidden opportunities slip through the cracks—a little effort now can lead to significant savings later. Click here to look at our blog for more financial tips to improve your financial wellness this year. Read Financial Mistakes to Avoid in 2025: Top 10 and get started!
