Tax deduction reduces an individual's tax obligation by lowering their taxable income.
Before figuring out how much tax you owe, deductions might lower your income. The amount of tax you owe is decreased by a deduction because it decreases your taxable income rather than by lowering your actual tax. The tax rate determines the value of a tax deduction.
A tax professional can helps to sort through the intricacy and decide whether to claim a credit, deduction, or both. Deductions and credits can be limited by the income, so picking one over the other can be tough.
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