Standard Deduction or Itemized Deductions: What Is the Difference?
Today, we talk about a basic tax topic: the difference between standard deduction and itemized deductions. Keep reading to learn more!
What Is the Standard Deduction
The standard deduction is an amount that reduces taxable income. This deduction is adjusted every year and varies according to your filing status.
You can benefit from the standard deduction if your standard deduction is larger than the total of your allowable itemized deductions.
To know how much is your standard deductions and to figure out whether you must detail your deductions, use this interactive assistant made by the IRS.
What Are Itemized Deductions?
In some cases, itemized deductions allow taxpayers to get a larger deduction, but to take advantage of this you must keep rigorous records of your expenses. Also, it’s important to keep in mind that some taxpayers are not allowed to use the standard deduction.
You ca benefit from itemizing your deductions if you:
- Had large uninsured medical and dental expenses
- Paid interest and taxes on their home
- Had large uninsured casualty or theft losses
- Made large contributions to qualified charities
Tax law changes allow taxpayers to deduct cash donations of up to $300 made by December 31, 2020, without having to itemize when they file their 2020 tax return.
If you need help deciding whether you should go for the standard deduction or itemized deductions, don’t hesitate to contact our experts at JT Tax Services. We’ll be more than happy to offer the knowledgeable assistance you need.
More Tips About Taxes
Interested in learning more about taxes? Then you’ve come to the right place! Here are some previous posts you may find interesting.
- Remember: Tax season is almost here!
- 4 Steps you can take to start preparing your 2020 tax return
- How to make tax filing easier this 2021
- Keep in mind these ideas when you file your taxes
- We debunk 4 common myths about tax returns
- Don’t forget this essential step if you are starting a new business
Contact the Experts at JT Tax Services
At JT Tax Services, we give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.
We are located in Oxnard, California. Contact us today by email (firstname.lastname@example.org), telephone (805-984-8890), or through our social media accounts on Facebook, Twitter, and LinkedIn to schedule a consultation or to learn more about our services.