State and local income taxes OR state and local sales taxes.You can deduct the state and local taxes you paid during the year, including: This can include insurance premiums, doctor co-pays, lab fees and the cost of prescription medications, eyeglasses and contact lenses, hospital stays, surgeries and ambulance services.īut there is a catch: you only get a tax benefit for medical costs that exceed 7.5% of your adjusted gross income (AGI), which you can find on line 11 of your 2021 Form 1040.įor example, if your AGI for 2021 is $100,000, you can only deduct medical expenses greater than $7,500 (7.5% of $100,000). You can deduct out-of-pocket medical, dental and vision expenses. To help you out, here are the itemized deductions you may be able to claim on your 2021 tax return. However, it’s worth looking at your deductions to see whether itemizing can reduce the amount of tax you owe (or give you a bigger tax refund). Is Itemizing Deductions Right For You?įew taxpayers have enough itemized deductions for itemizing to make sense. A worksheet in the IRS Instructions for Form 1040 can help you calculate this amount. Taxpayers age 65 or older or blind can claim higher standard deductions. $25,100 for married couples filing jointly or qualifying widow(er).$12,550 for single taxpayers and married individuals filing separate returns.However, if your total itemized deductions are greater than the standard deduction available for your filing status, itemizing can lower your tax bill.įor 2021 tax returns (those filed in 2022), the standard deduction numbers to beat are: If you itemize, you’ll need to list each of these expenses on Schedule A and attach it to your tax return.Ĭlaiming the standard deduction is easier because you don’t have to keep track of what you spent, or hold on to supporting documents like receipts, bank statements, medical bills and tax forms. Itemized deductions are what you actually spent on certain deductible expenses, such as medical expenses, state and local taxes, mortgage interest and charitable deductions. If you claim the standard deduction, you’ll simply enter the available standard deduction on your Form 1040. The standard deduction is a flat amount determined by the IRS based on your filing status. When you file your tax return, you generally have two options: Itemized Deductions: What’s the Difference?
#Itemized vs standard calculator software
Note: Only applies to returns being filed using software products.On Cash App Taxes' Website Standard Deduction vs. The PDF examples below show how Schedule 3 can be calculated.
Schedule 3 - Time Ratio for Part-Year Residents