Which of the following is a common type of deduction?

The correct choice highlights expenses incurred during the year as a common type of deduction. Deductions lower the taxable income of an individual or business by subtracting certain expenses from their total income. This can include a wide range of expenses such as medical bills, mortgage interest, student loan interest, and certain business expenses.

Focusing on expenses allows taxpayers to reduce their overall tax burden by accounting for costs that are necessary for earning income or maintaining their everyday lives, thus making it an integral part of tax returns. Other options do not typically qualify as common deductions. Personal loans are not deductible as they are not considered expenses; instead, they are liabilities. Capital gains refer to profits made from the sale of assets and are taxed as income rather than being deductible. Sales tax refunds are not deductions either; rather, they represent a return of previously paid tax amounts. This makes the option focused on expenses the best and most relevant choice regarding common deductions.