Our friends over at Napkin Finance are giving us the breakdown today in our latest Best of the Web: How do tax deductions work?
“What is a tax deduction? If something is “tax deductible,” it means that you can subtract the value of that item from your taxable income. A tax deduction, therefore, reduces the amount of taxes you owe but not dollar for dollar.”
For a complete understanding, watch the video above, or read the full article at Napkin Finance.