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Tax Security. What Is the Standard Deduction? Key Takeaways The standard deduction is the portion of income not subject to tax that can be used to reduce your tax bill. You can choose between a standard deduction and itemized deductions.
The amount of your standard deduction is based on your filing status, age, and other criteria. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
Compare Accounts. However, certain individuals who were nonresident aliens or dual status aliens during the year may take the standard deduction in the following cases:. Refer to Publication , U. Tax Guide for Aliens for more information. More In Help. Not Eligible for the Standard Deduction Certain taxpayers aren't entitled to the standard deduction: A married individual filing as married filing separately whose spouse itemizes deductions An individual who was a nonresident alien or dual status alien during the year see below for certain exceptions An individual who files a return for a period of less than 12 months due to a change in his or her annual accounting period An estate or trust, common trust fund, or partnership However, certain individuals who were nonresident aliens or dual status aliens during the year may take the standard deduction in the following cases: A nonresident alien who is married to a U.
Page Last Reviewed or Updated: Nov Is someone else claiming you as a dependent? If you live in a state that requires you to pay income taxes, there may be a state-based standard deduction that you can claim on your state tax return. There is an IRS tool that you can use to calculate your own standard deduction. The difference between the standard deduction and an itemized deduction is simple.
The former is a specific or standard number determined solely by your age and filing status. But the latter requires you to manually itemize your deductions. That means you would have to sit down, review your financial documents and add everything up. Whatever gives you the largest deduction is the one you should probably go for. The standard deduction has also become even more attractive since the Tax Cuts and Jobs Act dramatically increased the size of it while removing or reducing some itemized deductions.
Of course, if you want to itemize but need help doing so, you may want to talk to a financial advisor who specializes in taxes.
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