Deductions and credits

Deductions reduce the income you are taxed on. Credits reduce the tax itself. The rules depend on the country and the year.

By country

• United States: deductions and credits are entered on Schedules 1 and 2 and on the credit lines of Form 1040. Itemised deductions on Schedule A are not in the product yet.
• Canada and India: personal return forms are not offered yet. Keep your records anyway, and ask your accountant what you can claim.

Keeping receipts with entries

A deduction is only as good as the proof behind it.

1. Keep the receipt or statement for each deduction or credit, in a folder for the year.
2. Write the receipt date, the payee and the amount in the entry's memo, up to 200 characters.
3. Note where the receipt is kept, for example "folder 2026 / medical".
4. Do not write card numbers, account numbers or ID numbers in a memo.

Checking before you file

• Each deduction has a receipt or statement you can show.
• Credits match the form's rules for your income and family.
• Nothing is counted twice, for example a cost that is also in a business expense.

If you are unsure whether an item qualifies, ask your accountant before you enter it.