- Many retirees reach the point in life where they own their home. Retired real estate property owners may still deduct real estate taxes charged at a state, local or foreign level when there is no longer a mortgage on the property. Retirees selling their home to move closer to family or downsize may deduct the prorated amount of real estate taxes accrued while they owned the home during the year.
- The IRS allows deductions of expenses related to hobbies not to exceed the amount of income reported. For example, a retiree crafting wooden toys during the year as a hobby may sell a few of them to friends during the holiday season. The retiree can then deduct expenses up to the amount of income received. If he sold $300 worth of toys, he can deduct $300 worth of expenses when itemizing deductions on Schedule A (Form 1040).
- Volunteering often results in out-of-pocket expenses. The IRS allows deductions for the expenses related to charitable service that are not reimbursed. This includes car expenses from using your vehicle to deliver meals to the elderly, taking children to events or helping transport goods from one location to another for recognized charities. You have the option to either deduct actual out-of-pocket expenses or use a standard mileage rate.
- Many retired couples find themselves acting as a foster care providers for their grandchildren or other children in the community when they are placed by a recognized organization. Unreimbursed expenses for feeding, clothing and caring for a foster child may be deducted. Expenses not deductible are those provided in order to claim the foster child as a dependent, according to IRS Publication 516.
- Church deacons established under a permanent diaconate program at a church may deduct as a charitable donation any unreimbursed expenses. The allowable deductions include the cost of books, vestments and transportation necessary for deacon service. Trips to conventions may also be deducted if the deacon attends them as a chosen representative of the church.