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 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 2016
Your standard deduction lowers your taxable income. It is not a refund
2016 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 $9300 (65 or older + $1550)
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 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 2016
Your standard deduction lowers your taxable income. It is not a refund
2016 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 $9300 (65 or older + $1550)