Top Seven Tax Deductions for Seniors and Retirees over 50

1. Medical and dental expenses. Medical and dental expenses are often one of the largest expenses for retired people. These include health insurance premiums (including Medicare premiums), long-term care insurance premiums, prescription drugs.

2. Selling your house. Retired people often sell their homes to move into smaller places or retirement communities. If you've lived in your home for a long time, you probably have substantial equity and will earn a large profit on the sale. Fortunately, you may not have to pay any tax on your profit. As long as you live in your home for at least two out of the five years before you sell your house, the profit you make on the sale -- up to $250,000 for single taxpayers and $500,000 for married taxpayers filing jointly -- is not taxable.

3. Retirement plan contributions. Just because you are retired or semi-retired doesn't mean that you can't make tax-deductible contributions to retirement plans such as IRAs. Those over 50 have higher contribution limits for traditional IRAs, Roth IRAs, and 401(k)s.

4. Investment expenses. The best way to earn money when you retire is in the form of interest, dividends, and capital gains from investments. Dividends and capital gains are taxed at lower rates than ordinary income, ranging from 0% to 20% depending on your overall income tax bracket. Unlike income from a job or business, these types of income are not subject to Social Security or Medicare taxes.

5. Business expenses. Many retirees continue to run their own businesses or start new ones. For example, some retired employees work part-time as a consultant for their former employers and other clients. Having a business (whether full- or part-time) is a great way to get tax deductions. You may deduct all the necessary expenses you incur to do business, so long as they are reasonable in amount. This includes business travel, the cost of business equipment such as computers, and outside or home offices.

6. Charitable contributions. Retirement is a time many people think about giving back to their community by making charitable contributions. Such contributions are deductible as itemized deductions; however, they are subject to special limitations. Cash contributions of up to 50% of your adjusted gross income are deductible each year as an itemized deduction.

7. Standard deduction. This applies if you don't itemize your deductions (many older folks don't if they are no longer paying mortgage interest). Anyone 65 and older by December 31 of the tax year is entitled to a higher standard deduction. Technically, you are considered 65 on the day before your 65^th birthday so you can take the higher standard deduction if you turn 65 by January 1st.  People age 65 and older (or blind) get an additional standard deduction. You can claim the higher deduction if only your spouse is older than 65 and you file a joint return.

Source:  https://www.nolo.com/legal-encyclopedia/top-tax-deductions-seniors-retirees-29591.html- By Stephen Fishman, J.D.