The Daily Deduction · Issue No. 4 · November 7, 2026
The Credits Nobody Claims
Every year the IRS offers money that most eligible people never ask for — a deduction hiding under a credit's name, a credit for savers that expires soon, a certificate sitting in a closing drawer. Four of them, with the forms that claim them.
Education only — not personal tax advice. Personal questions route to a credentialed pro.
Figures verified against IRS sources · Tax-year tables 2016–2026 · Re-verified each season by the Update Engine · Last review: November 7, 2026
Start with the one that has the wrong name
People call it the “teacher credit.” There is no such credit — and that wrong name is why money gets left behind. The educator expense deduction is a deduction: it lowers the income you are taxed on, claimed above the line on Schedule 1 (line 11), so it works whether or not you itemize. If you are a K-12 teacher, instructor, counselor, principal, or aide who worked at least 900 hours in the school year, you can deduct up to $300 of unreimbursed classroom expenses for 2025 — $600 on a joint return when both spouses are eligible educators, never more than $300 each.
Two changes to file away for next year: for 2026 the amount rises to $350 ($700 joint), and educators who itemize gain a second door — qualifying expenses above the cap become deductible on Schedule A with no dollar limit (P.L. 119-21). If you buy classroom supplies in 2026, keep every receipt; the log matters more than ever.
The Saver's Credit: the classic
If your income is modest and you put money into an IRA or a workplace retirement plan, the Saver's Credit pays you back for saving: 50%, 20%, or 10% of the first $2,000 you contribute ($4,000 counted on a joint return) — up to $1,000, or $2,000 for a couple — figured on Form 8880, on top of whatever the contribution itself saved you. For 2025 it phases out completely above $79,000 of AGI filing jointly, $59,250 for head of household, $39,500 for single and most other filers. The gates that quietly disqualify people: under 18, claimed as someone else's dependent, or a full-time student.
And a deadline almost nobody is printing: 2026 is the last year of the credit in this form. From 2027 it is replaced by the federal Saver's Match under SECURE 2.0. If you qualify, the next two filing seasons are the ones not to sleep through.
The certificate in the closing drawer
When some people buy a home — usually through a first-time-buyer program — a state or local housing agency hands them a Mortgage Credit Certificate (MCC). That certificate converts part of their mortgage interest into a dollar-for-dollar credit, every year they live in the home: the rate printed on the certificate (10% to 50%) times the interest paid, figured on Form 8396 — capped at $2,000 a year if the rate is over 20%. Homeowners forget the certificate exists; the credit is claimed year by year or not at all.
Three more that almost never get claimed: the Adoption Credit — up to $17,280 per child for 2025 on Form 8839, and since 2025 up to $5,000 of it is refundable again, with the rest carrying forward 5 years. The Credit for the Elderly or the Disabled on Schedule R — narrow income gates, which is why the IRS offers to figure it for you. And the Credit for Prior Year Minimum Tax on Form 8801 — if you paid AMT in a past year (stock options are the classic trigger), part of it may come back in a year when you are not in AMT.
New for 2026: giving counts even if you don't itemize
Until now, taking the standard deduction meant charitable giving earned no federal tax benefit at all. Beginning with tax year 2026 that changes: non-itemizers may deduct up to $1,000 of cash contributions to eligible charities — $2,000 filing jointly. Cash only, given during the year, and not to a donor-advised fund or supporting organization.
The cap is the cash you can prove — which makes a giving log a tax document now. The Giving & Deduction Capture log on the Dashboard exists for exactly this: two minutes when you give beats a shoebox reconstruction next April.
Sources: IRS Topic No. 458 and Rev. Proc. 2025-32 (educator expenses); Form 8880 and Rev. Proc. 2024-40 (Saver's Credit); Form 8396 and IRC §25 (Mortgage Interest Credit); Form 8839, IRS Topic No. 607, and FS-2026-03 (adoption); Schedule R instructions (elderly or disabled); Form 8801 (prior year minimum tax); IRS, Working Families Tax Cuts charitable-giving guidance, irs.gov (2026 non-itemizer deduction).
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