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lveal
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If my standard deduction is $13,850 and my itemized deductions are $21,444. Why is it better to take the standard deduction and why is the tax due the same?

 
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5 Replies

If my standard deduction is $13,850 and my itemized deductions are $21,444. Why is it better to take the standard deduction and why is the tax due the same?

Are you making the common mistake of just adding up all the amounts for your itemized deductions without considering the caps and thresholds that must be met?

STANDARD DEDUCTION

Many taxpayers are surprised because their itemized deductions are not having the same effect as they did on past tax returns.  The new higher standard deduction and the elimination of certain deductions, as well as the cap on state and local taxes have had a major impact since the new tax laws went into effect beginning with 2018 returns.

 

Your itemized deductions 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  tough thresholds—medical expenses, for example, must meet a threshold that is pretty hard to reach.  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.  Under the new tax laws, some deductions have been capped—there is a $10,000 limit to the itemized deductions for state, local, property and sales taxes.

 

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

 

2019 Standard Deduction Amounts

 

Single $12,200   (+ $1650 65 or older)

Married Filing Separate  $12,200   (+ $1300 if 65 or older)

Married Filing Jointly $24,400   (+ $1300 for each spouse 65 or older)

Head of Household $18,350  (+ $1650 for 65 or older)

 

Look on line 9 of your 2019 Form 1040 to see your itemized/standard deduction amount

 

 

You are posting from online Self-Employed.  Are you confusing the business expenses you can enter on a Schedule C with the other deductions you can enter on a Schedule A?   

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

If my standard deduction is $13,850 and my itemized deductions are $21,444. Why is it better to take the standard deduction and why is the tax due the same?

If it's giving you the Standard Deduction and not showing you Schedule A you can check the actual amount of itemized deductions by using by going to
Tax Tools on left
Tools - Topic Search (top left box)
Type in itemized deductions, choosing. It should highlight that in the list, click on GO

 

Then Click on "Change my deduction". That will display the actual amount of itemized deductions vs. the standard deduction. (Be sure to uncheck "Change my deduction" after checking it so you do not lock in the wrong deduction.

 

How to change between the Standard Deduction and Itemized Deductions
https://ttlc.intuit.com/community/accessing/help/how-do-i-change-from-the-standard-deduction-to-item...

 

Carl
Level 15

If my standard deduction is $13,850 and my itemized deductions are $21,444. Why is it better to take the standard deduction and why is the tax due the same?

Another possibility. If you are married, but are filing separate returns, then if your spouse took the standard deduction, that means you to *MUST* take the standard deduction. It doesn't matter that your itemized deductions may be more.

 

If my standard deduction is $13,850 and my itemized deductions are $21,444. Why is it better to take the standard deduction and why is the tax due the same?

If you are looking at the summary screen in the deductions and credits section  then be aware you cannot count the credits as they are not part of the Sch A and you must take the SALT limitation & medical AGI reduction into consideration.  

If my standard deduction is $13,850 and my itemized deductions are $21,444. Why is it better to take the standard deduction and why is the tax due the same?

Quite likely Alternative Minimum Tax (AMT).  Does your tax return have a number on Line 1 of Schedule 2 (which comes from Form 6251)?  If so that is probably it. 

 

Some of the Itemized deduction do NOT count for AMT.  When you are subject to AMT, that effectively means those Itemized deductions are useless.

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