The standard deduction is allotted to all taxpayers by the IRS. It represents an amount of income that the government will not tax.
Taxpayers who want to simplify their returns and opt not to itemize can claim the standard deduction. Just chose the correct filing status, and check the box for the standard deduction.
In 2015, the standard deduction for married couples who file together is a combined $12,600. Married filing separately or single filers can expect a deduction of $6,300. In some instances, taxpayers can net a larger deduction if they itemize their expenses.
Itemized Deductions
In order to itemize, you have list each expense you qualify to deduct. This benefits taxpayers with a greater amount of deductions than the standard amount.
If you are married and file separately from your spouse, you have to itemize if your spouse does. Otherwise, you may want to consider itemizing your deductions if:
- You accrued large medical and dental expenses that weren’t reimbursed
- You pay taxes and interest on your home
- You have unreimbursed employee business expenses
- You suffered casualty or theft loss not covered by insurance
- You made large charitable donations during the tax year
In many cases, it may be beneficial to calculate your itemized deductions to determine if it is worth more than the standard deduction, and then chose the option which saves you the most money.
