Young adults who are strapped for cash can put more money in their pockets by taking advantage of tax breaks designed just for them.
Moving expenses. New grads can deduct the cost of moving themselves and their belongings to their first job out of school, as long as the job is at least 50 miles from their old residence.
| Row 0 - Cell 0 | Tax Savings on Your First Job |
| Row 1 - Cell 0 | Cost of Living Reality Check |
| Row 2 - Cell 0 | Recession-Proof Careers |
Saver's credit. Depending on their income, some young adults can trim their tax bill by up to $1,000 as a reward for contributing to an IRA, 401(k) or other retirement plan. The credit is available to singles with an adjusted gross income of less than $26,000 and married couples whose AGI is less than $52,000.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Student-loan interest. Young people can write off up to $2,500 of interest on student loans each year even if they don't itemize deductions. And now they can also write off student-loan interest paid by their parents. The IRS considers payments by parents on a child's loan to be a gift to the child.
Roth IRAs. Roths are primarily for retirement savings, but they're flexible enough to be used for a down payment on a house. You can withdraw contributions to a Roth at any time without paying taxes or a penalty. And after the account has been open for five years, you can also withdraw up to $10,000 of earnings tax- and penalty-free to buy a first home.
Tax forms. In order to get all of these benefits, it's important that young adults not file the Form 1040EZ. Filers can't claim the saver's credit, write off moving expenses or deduct student-loan interest on this simplified form. Instead, they should use the standard Form 1040.
-
Social Security Is Taxable, But There Are WorkaroundsIf you're strategic about your retirement account withdrawals, you can potentially minimize the taxes you'll pay on your Social Security benefits.
-
Serious Medical Diagnosis? Four Financial Steps to TakeA serious medical diagnosis calls for updates of your financial, health care and estate plans as well as open conversations with those who'll fulfill your wishes.
-
Trump’s Tax Cut Risks Your SNAP, Medicaid BenefitsTax Cuts The GOP budget blueprint could slash lifesaving programs for millions of U.S. households.
-
Missed Tax Day? Nearly One Million Taxpayers Still Can File and Claim Valuable Tax RefundsTax Refunds As many as one million taxpayers could be missing out on a significant tax refund.
-
Which Generation Pays the Most Tax in the US?Tax Burden Polls show that most people feel like taxes are unfair. But which age group bears the brunt of the tax burden in the United States?
-
How the Trump Harvard IRS Tax Threat Could Impact YouTax Law Trump's latest higher education showdown raises fundamental questions that could reach beyond Harvard's nonprofit tax status.
-
Tax Day 2025: Don’t Miss These Freebies, Food Deals and DiscountsTax Day You can score some sweet deals on April 15 in some select restaurants like Burger King, Shake Shack, and more.
-
Tax Time: Does Your Kid Influencer Owe Taxes?State Tax Some minors are making big money on social media. Here’s how to know if they need to file taxes.
-
Did Florida’s Chance at $1,000 in Property Tax Rebates Vanish?State Taxes The Florida Legislature bypassed Gov. Ron DeSantis’ wish to cut property taxes and instead voted to lower the state’s sales tax.
-
How Caregivers for Adults Can Save on Taxes in 2025Tax Breaks Caring for your parent or spouse can be stressful, but the IRS offers tax breaks for qualifying taxpayers. Here they are.
