Thanks. So if I understand that correctly:
Example 1: If my Adjusted Gross income is $50,000 and my business expenses are $5,000, I'm better off using the standard deduction of $6,300 as that will lower my taxable income by a greater amount.
Example 2: If my Adjusted Gross income is $50,000 and my business expenses are $8,500, I'm better off itemizing my deductions as that will lower my taxable income by $7,500 (the $8,500 less 2% of my Adjusted Gross income).
If this is correct, it seems that I'm better off using the standard deduction of $6,300 until my business expenses reach $7,300. At that point, I should be indifferent between using the standard deduction and itemizing my expenses, as both methods will lower my taxable income by the same amount of $6,300. However, once my business expenses exceed $7,300, I'm better off itemizing my expenses rather than using the standard deduction. Is that correct? Thank you.
