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 1. Jackson Hewitt
 2. Filing Your Taxes
 3. Standard Deductions vs. Itemized Deductions: Which Should You Choose?

Filing your taxes


STANDARD DEDUCTIONS VS. ITEMIZED DEDUCTIONS: WHICH SHOULD YOU CHOOSE?




Jo Willetts, EA

Director, Tax Resources

Published on: April 25, 2023


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One of the first steps when filing your annual tax return is to decide whether
to take the standard deduction, or to itemize your deductions. The common goal
for every taxpayer is to take the option that gives the lowest overall tax. So,
which deduction is right for you? Let’s take a further look.


WHAT ARE ITEMIZED DEDUCTIONS?

An itemized deduction is an expense you can subtract from your adjusted gross
income, which means you could pay less in taxes. If you’re wondering how much
itemized deductions can save you, here’s a helpful tip to keep in mind. You
should itemize deductions if your allowable itemized deductions are greater than
your standard deduction, or if you must itemize deductions because you can’t use
the standard deduction.

According to the IRS, itemized deductions that taxpayers may claim include the
following:

 * Unreimbursed medical or dental expenses that exceed 7.5% of adjusted gross
   income
 * State and local income or sales taxes
 * Real estate and personal property taxes
 * Home mortgage interest
 * Gifts to a qualified charity or non-profit
 * Personal casualty and theft losses from a federally declared disaster

Should you choose to itemize these deductions, you may do so by filing a
Schedule A (Form 1040). Your local Tax Pro can go over this with you and help
you determine which option is best.


WHAT IS A STANDARD DEDUCTION?

A standard deduction is a specific dollar amount that reduces the amount of
income on which you’re taxed. The standard deduction amount depends on your
filing status and whether you’re 65 or older, are blind, and whether another
taxpayer can claim you as a dependent. If you are 65 or older on the last day of
the year and you don’t itemize deductions, then you are entitled to a higher
standard deduction.

If you’re like most filers and use Form 1040, you can find the standard
deduction on the first page of the form. If you’re using Form 1040-SR, the U.S.
tax return for senior citizens over the age of 64, then your standard deduction
will be found on the last page of that form.

If you’re wondering who qualifies for standard deduction, it’s important to read
and understand the instructions for both Form 1040 and 1040-SR. Not all
taxpayers qualify for a standard deduction. Those who don’t qualify include:

 * Married spouses filing separate returns, and one spouse itemizes. Both
   spouses must itemize if one does.
 * A taxpayer who files a return for a period of less than 12 months.
 * An individual who was a nonresident alien, or dual-status alien during the
   tax year.


2022 AND 2023 STANDARD DEDUCTION CHART

Filing status

2022 standard deduction

2023 standard deduction

Single $12,950 $13,850 Married filing jointly $25,900 $27,700 Married filing
separately $12,950 $13,850 Head of household $19,400 $20,800


IS IT BETTER TO TAKE THE STANDARD DEDUCTION OR ITEMIZE DEDUCTIONS?

It all depends on changes to current tax laws and how much you have in total
deductions. If your itemized deductions add up to less than the standard
deduction, it may make sense to take the standard deduction. A good way to make
the best decision is to have an expert Tax Pro on your side, which is key to
helping you file the most accurate return, and get your biggest possible refund.

See your local Tax Pro for the best personalized help, however easy or complex
your tax documents may be, the next time you’re ready to file.

About the Author

Jo Willetts, Director of Tax Resources at Jackson Hewitt, has more than 35 years
of experience in the tax industry. As an Enrolled Agent, Jo has attained the
highest level of certification for a tax professional. She began her career at
Jackson Hewitt as a Tax Pro, working her way up to General Manager of a
franchise store. In her current role, Jo provides expert knowledge company-wide
to ensure that tax information distributed through all Jackson Hewitt channels
is current and accurate.

Jackson Hewitt Editorial Policy

*This content is for general informational purposes only. It is not intended to
be comprehensive and should not be construed as professional tax or financial
advice for any specific individual tax situation. Taxpayers should always
consult a qualified professional for individual guidance. This information
constitutes a solicitation under the Treasury Department’s Circular 230. Most
offices are independently owned and operated.

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