How come my property taxes did not reduce my tax bill

[jerry2000 · Accepted solution]

Either you have not entered enough itemized deductions to total more than your standard deduction, or,
That usually is an indication that your income is high enough that you are subject to the Alternative Minimum Tax. When you are subject to the AMT, many ordinary deductions such as property tax don't work any more. They reduce your ordinary income tax, but are added back to your AMT income and there is no net change in tax. Once you are subject to the AMT, there is no way around it.

[xmasbaby0]

Your itemized deductions --including property taxes--have to be more than your standard deduction before you will see a change in your tax owed or tax refund.  The deductions you enter do not necessarily count “dollar for dollar;” many of them are subject to meeting thresholds  (for example: only the amount of your medical deductions that are over 10% of your AGI or over 7.5% if you are 65 or older are “counted”) or are calculated by a percentage of what you entered. The software program uses all the IRS rules that apply to the expenses you enter, and it tells you if you have enough to use your itemized deductions or if using the standard deduction is more advantageous for you. Here are the Standard Deductions for 2015:

Your standard deduction lowers your taxable income.  It is not a refund 

2015 Standard Deductions

Single    $6300  (65 or older + $1550)

Married Filing Separately   $6300  (65 or older +  $1250)

Married Filing Jointly           $12,600  (65 or older + $1250@)

Head of Household $9250  (65 or older + $1550)