But this year, taxpayers should set aside records of expenses they could not fully deduct on their 1986 return but which can be deducted in future years.

For example, people who refinanced their homes last year are not allowed to fully deduct the points they paid to the lender.

Until a working mom (or any single-parent head of household) can fully deduct the cost of child care, too many workers in that area will be underpaid or paid off the books, not covered by Social Security and not contributing taxes.

In its final appearance, taxpayers will be allowed to fully deduct charitable contributions, putting non-itemizers on an equal footing with itemizers.

But for now, he cautioned, taxpayers who choose to fully deduct points paid in a refinancing risk penalties in the face of the I.R.S. opinion.

Nontaxable dividends will not qualify as investment income, and that by itself could mean that some investors will no longer have enough investment income to fully deduct their investment interest.

Among the changes incorporated in 1986 returns that will benefit taxpayers are these: * Taxpayers who do not itemize their deductions will be able to deduct fully their charitable contributions.

Individuals are allowed to fully deduct the federal income taxes they pay from their state taxes, something few states allow, a boon for those in the top brackets.

However, If your customer was also registered for VAT and was able to fully deduct your VAT charge as their input tax then they did not bear the cost of the mistake.

It could provide lower monthly payments or free up money needed for other things that are important to the homeowner, regardless of whether he or she can fully deduct interest payments.