Taxpayers have two options when completing a tax return: take the standard deduction or itemize their deductions. Taxpayers should use the option that gives them the lowest overall tax.
The standard deduction amount increases slightly every year and varies by filing status. The standard deduction amount depends on the taxpayer's filing status, whether they are 65 or older or blind, and whether another taxpayer can claim them as a dependent. A married individual filing as married filing separately cannot take the standard deduction if the other spouse itemizes deductions - if one spouse itemizes on a separate return, both must itemize.
Itemized deductions that taxpayers may claim include: state and local income or sales taxes, real estate and personal property taxes, home mortgage interest, mortgage insurance premiums on a home mortgage, personal casualty and theft losses from a federally declared disaster, gifts to a qualified charity, and unreimbursed medical and dental expenses that exceed 7.5% of adjusted gross income.
Opmerkingen