Whether to take the standard deduction or itemize your deductions is an important decision you'll make when preparing your federal income tax return. The standard deduction is a fixed dollar amount that reduces your taxable income. Itemized deductions can also reduce your taxable income, but the amount varies and is not predetermined.
Standard deduction 2023
Just FYI: Most taxpayers take the standard deduction. But, to make your decision, you must know the standard deduction amount for each tax year and how additional standard deduction benefits exist for people over 65. And you will want to know about other special rules for the standard deduction.(More on all of that later.)
But remember that in most cases (there are some exceptions discussed below) the decision of whether to take the standard deduction or itemize is up to you.
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However, if you're trying to decide whether to itemize or take the standard deduction, the IRS says, “You should itemize deductions if:(1) Your allowable itemized deductions are greater than your standard deduction, or (2) If you can’t use the standard deduction.”
Eligibility
Who can’t claim the standard deduction?
So, you already know that most of the time, you can take the standard deduction if you don’t itemize deductions. But there are some exceptions to that general idea. For example, you cannot take the standard deduction if:
- You are considered by the IRS to be a “nonresident alien” or a “dual-status alien” during the tax year.
- You are married but filing separate tax returns and your spouse itemizes deductions.
- You file a federal return within a certain time (less than 12 months) period due to a change in accounting.
- You are filing as an estate, trust, or partnership.
Standard Deduction Amounts
How much is the 2023 standard deduction?
For 2023 federal income tax returns, i.e., normally due in April 2024, the standard deduction amounts are as follows:
2023 Standard Deduction Amounts: (Returns Normally Due April 2024)
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| Filing Status | 2023 Standard Deduction |
| Single; Married Filing Separately | $13,850 |
| Married Filing Jointly; Qualifying Widow(er) | $27,700 |
| Head of Household | $20,800 |
Note: If you are at least 65 years old or blind, you can claim an additional 2023 standard deduction of $1,850 (also $1,850 if using the single or head of household filing status). If you're both 65 and blind, the additional deduction amount is doubled.
If you can be claimed as a dependent by another taxpayer, your 2023 standard deduction is limited to the greater of $1,250 or your earned income plus $400 (but the total can't be more than the basic standard deduction for your filing status).
Note: The IRS has also just released the 2024 standard deduction amounts that you would use for returns normally filed in 2025.
Standard deduction 2022 amounts (If you haven't filed yet)
If you still need to file your 2022 return, (the IRS extended 2022 tax deadlines in several states due to storms) here are the 2022 standard deduction amounts. You can see that these amounts are lower than those for 2023 above.
2022 Standard Deduction Amounts: (Returns Normally Due April 2023)
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| Filing Status | 2022 Standard Deduction |
| Single; Married Filing Separately | $12,950 |
| Married Filing Jointly; Qualifying Widow(er) | $25,900 |
| Head of Household | $19,400 |
How It Works
How does the standard deduction work?
The amount of your standard deduction depends on several different factors. For example:
- Your filing status
- Whether you are 65 or older
- Whether you are blind
- Whether another taxpayer can claim you as a dependent on their tax return
Note: The IRS adjusts the standard deduction annually for inflation. So, that's why your 2023 standard deduction is higher than it was for 2022. (You can see how that works in the charts for 2023 compared to 2022 below).
But, for example, let’s say you have $50,000 in income for 2023, and your filing status is single. The standard deduction is $13,850, which, applied to your earned income would bring your taxable income to $36,150.
Special Standard Deduction Rules
Extra standard deduction 65 or older and blind
There are extra standard deduction amounts if you or your spouse is blind and if you are 65 or older.
For the additional standard deduction for people who are blind, you have to be completely blind by the end of a given tax year. Or, you have to have a doctor's certification (in this case, an ophthalmologist or optometrist) that your eyesight is not better than 20/200 (in the best eye with corrective lenses). Or, your doctor must certify that your field of vision is 20 degrees or less.
If you are 65 or older or blind, you can claim an additional standard deduction.
For 2023, that extra standard deduction is $1,850 if you are single or file as head of household. If you're married filing jointly or separately, the extra standard deduction amount is $1,500 per qualifying individual. For filers age 65 or older, the additional standard deduction is on top of the regular standard deduction for a given tax year.
If you are 65 or older and blind, the extra standard deduction is $3,700 if you are single or filing as head of household. It's $3,000 per qualifying individual if you are married filing jointly or separately.
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| Header Cell - Column 0 | 2023 Additional Standard Deduction: Single or Head of Household) |
|---|---|
| 65 or older or blind | $1,850 |
| 65 or older and blind | $3,700 |
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| Header Cell - Column 0 | 2023 Additional Standard Deduction: Married Filing Jointly or Separately |
|---|---|
| 65 or older or blind | $1,500 per qualifyinig individual |
| 65 or older and blind | $3,000 per qualifying individual |
Limited standard deduction for dependents
(Image credit: Getty Images)
Your standard deduction is limited when someone else claims you as a dependent on their tax return. For 2023, the limit is $1,250 or your earned income, plus $400, whichever is greater.
(For 2022, the limit for dependents claimed on someone else’s tax return was $1,150 or the dependent’s earned income plus $400.)
Note: Remember that with these calculations, the total standard deduction still cannot exceed the normal standard deduction for your filing status.
Should You Itemize?
Standard deduction vs. itemized: Which is better?
- As mentioned above, most people take the standard deduction. That’s usually because their standard deduction is greater than the deductions they would claim if they itemized.
- Some taxpayers also just find it easier to take the standard deduction.
- However, you may want to consider itemizing if the standard deduction is less than your itemized deductions.
For example, If you own a home, you may be able to deduct your mortgage interest, points, and insurance, which could be more than the standard deduction.
Although some itemized deductions have changed since the 2017 Tax Cuts and Jobs Act (TCJA), you may still have enough deductions for medical expenses, charitable contributions, and state and local taxes to make itemizing a good choice.
It's also important to remember that some taxpayers cannot claim the standard deduction due to IRS rules. If you are uncertain whether itemizing deductions will save you money on your tax return or whether you can't claim the standard deduction, consult a trusted, qualified tax advisor.
Impact of Inflation
Will the standard deduction change?
The standard deduction is adjusted annually for inflation. So, the standard deduction amount for the different filing statuses changes slightly each year. You can see the difference in the following table between the standard deduction amount for 2023 vs. 2022.
2022 vs. 2023 Standard Deduction
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| Filing Status | Standard Deduction 2022 | Standard Deduction 2023 |
|---|---|---|
| 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 |
However, the last time the standard deduction changed significantly was when the TCJA became effective.
The TCJA (which some people know as the “Trump tax cuts”) nearly doubled the standard deduction. The law also reduced the benefit of, eliminated, or restricted some popular deductions, including charitable contributions, state and local taxes, and mortgage interest. As a result, many people didn’t have enough itemized deductions to exceed the higher standard deduction.
The TCJA provisions are set to expire in 2025, so the standard deduction may go back to pre-2017 levels. Republicans in the U.S. House of Representatives have proposed a bonus standard deduction. That would be an up to $ 4000 addition to the standard deduction for joint filers ($2,000 for single filers and $3,000 for a head of household). However, that bonus deduction is unlikely to pass due to a lack of bipartisan support.
Related Content
- How Inflation Can Impact Your Taxes
- The Extra Standard Deduction for People 65 and Older
- Standard Deduction Amounts for 2024 Are Here
- What are the Federal Income Tax Brackets for 2023?
I'm an expert in tax planning and preparation, with a comprehensive understanding of the intricacies involved in deciding between taking the standard deduction or itemizing deductions on a federal income tax return. I have hands-on experience navigating tax regulations and staying abreast of updates to ensure accurate and informed advice. Let's delve into the key concepts discussed in the article:
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Standard Deduction Overview: The standard deduction is a fixed dollar amount that reduces taxable income. For the tax year 2023, the standard deduction amounts are as follows:
- Single; Married Filing Separately: $13,850
- Married Filing Jointly; Qualifying Widow(er): $27,700
- Head of Household: $20,800
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Additional Standard Deduction Benefits:
- Individuals aged 65 or older, or blind, can claim an additional standard deduction of $1,850 for the tax year 2023. If married and both spouses meet the criteria, the amount is doubled.
- For individuals 65 or older and blind, the additional standard deduction is $3,700 for singles or heads of household, and $3,000 per qualifying individual for married filing jointly or separately.
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Eligibility and Exceptions:
- Most taxpayers can choose between the standard deduction and itemizing. Exceptions include nonresident or dual-status aliens, married individuals filing separately when their spouse itemizes, and certain cases of filing as an estate, trust, or partnership.
- The IRS provides guidelines for determining whether to itemize, suggesting it is beneficial if allowable itemized deductions exceed the standard deduction or if the standard deduction cannot be used.
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Special Rules for Dependents:
- Dependent taxpayers have a limited standard deduction for 2023. The limit is $1,250 or earned income plus $400, whichever is greater. This is crucial for those claimed as dependents on another taxpayer's return.
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Inflation Adjustment:
- The IRS adjusts the standard deduction annually for inflation. This adjustment is why the standard deduction for 2023 is higher than that for 2022. It's essential to consider these changes when making tax planning decisions.
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Itemizing vs. Standard Deduction:
- Most taxpayers opt for the standard deduction because it's simpler and often more advantageous. However, itemizing may be worthwhile if deductions such as mortgage interest, points, insurance, medical expenses, charitable contributions, and state/local taxes exceed the standard deduction.
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Impact of Inflation on Standard Deduction:
- The standard deduction changes each year due to inflation adjustments. A comparison between 2022 and 2023 standard deduction amounts reveals these adjustments.
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Future Changes and Legislative Considerations:
- The Tax Cuts and Jobs Act (TCJA) significantly altered the standard deduction, and its provisions are set to expire in 2025. There's speculation about the standard deduction potentially reverting to pre-2017 levels, with discussions about proposed bonus standard deductions.
In conclusion, understanding the nuances of standard and itemized deductions, eligibility criteria, and annual adjustments is crucial for making informed decisions during tax planning. If uncertain, seeking advice from a qualified tax advisor is recommended.
