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

Donations

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 (info@jttaxservices.com), 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.

With tax season just around the corner, this is the perfect time to review five mistakes you should avoid to make tax filing easier, faster, and more accurate.

1. Basic Information That Is Wrong or Missing

Getting the basics right goes a long way toward filing a precise, error-free tax return. As you prepare your return, triple check to make sure that these fields are included and are accurate:

• Social Security numbers: Every SSN on your tax return should appear exactly as printed on the Social Security Card.
• Misspelled names: The same principle applies here—all names must appear as written on the Social Security card of the person.
• Incorrect filing status: This information indicates whether you were married or single on December 31, 2020, and determines the amount of tax you should pay. To learn more about filing statuses, take a look at this previous post. You can also use the IRS Interactive Assistant to figure out your correct status.
• Incorrect bank account numbers: Your routing and account numbers should be accurate, so you can get your refund as soon as possible.

2. Math Errors

Let’s admit it: Math is not everyone’s strong suit. That’s why you should pay special attention to the math on your tax return. Using tax software or working with a professional tax preparer greatly reduces this type of mistakes. However, every taxpayer should always double check the math on their return.

3. Mistakes Figuring Credits or Reductions

There have been many changes to tax law due to the COVID-19 pandemic, so the odds or making this type of mistake are higher than usual. With options available that include earned income tax credit, child and dependent tax credit, and recovery rebate credit, it’s advisable to seek assistance from a professional to determine which are the options you qualify for.

4. Unsigned Forms

This is particularly important because an unsigned tax return isn’t valid. There are some exceptions, as in the case of members of the armed forces or taxpayers with a valid power of attorney. But generally speaking, all taxpayers must make sure that their return is signed.

5. Expired ITIN

ITIN stands for Individual Taxpayer Identification Number, and as its name suggests, it helps the IRS keep track of every individual taxpayer. If your ITIN expired, the IRS will treat it as a return filed on time, but it won’t apply any exemptions or credits. Once you renew your ITIN, the agency will process your return normally.

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 (info@jttaxservices.com), 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.