Landmark Tax Group

Itemizing vs. Standard Deduction

When you file a tax return, you usually have a choice to make: whether to itemize deductions or take the standard deduction. You should compare both methods and use the one that gives you the greater tax benefit.

Here are six tax facts to help you choose.

1. Figure your itemized deductions.  Add up the cost of items you paid for during the year that you might be able to deduct. Expenses could include home mortgage interest, state income taxes or sales taxes (but not both), real estate and personal property taxes, and gifts to charities. They may also include large casualty or theft losses or large medical and dental expenses that insurance did not cover. Unreimbursed employee business expenses may also be deductible.

2. Know your standard deduction.  If you do not itemize, your basic standard deduction amount depends on your filing status. For the 2015 tax return, the basic amounts are:

• Single = $6,300 (compared to $6,200 for 2014)
• Married Filing Jointly  = $12,600 (compared to $12,400 for 2014)
• Head of Household = $9,250 (compared to $9,100 for 2014)
• Married Filing Separately = $6,300 (compared to $6,200 for 2014)

3. Apply other rules in some cases. Your standard deduction is higher if you are 65 or older or blind. Other rules apply if someone else can claim you as a dependent on his or her tax return. To figure your standard deduction in these cases, use the worksheet in the instructions for Form 1040, U.S. Individual Income Tax Return.

4. Check for the exceptions.  Some people do not qualify for the standard deduction and should itemize. This includes married people who file a separate return and their spouse itemizes deductions. See the Form 1040 instructions for the rules about who may not claim a standard deduction.

5. Choose the best method.  Compare your itemized and standard deduction amounts. You should file using the method with the larger amount.

6. File the right forms.  To itemize your deductions, use Form 1040, and Schedule A, Itemized Deductions. You can take the standard deduction on Forms 1040, 1040A or 1040EZ.

See: Deductible vs. Non-Deductible – A Simple Guide

See: 6 Ways To Reduce Your Chance Of An IRS Audit

“Woooooohooooo!!!!! Thank you, thank you, thank you. You have done such an amazing job and I appreciate it.”  – Fran L.
(More Client Testimonials)

For immediate assistance with tax deductions, or another tax matter, contact us today at 1-714-382-6780 for a FREE and CONFIDENTIAL consultation with our CPAs and former IRS Auditors. 

                         

We look forward to serving you. 

More IRS News and Information 

As Featured In