"Based on what you just told us, itemizing your deductions is best for you"
Itemized deduction: $12,355
but that's way smaller than standard deduction at $24,800. The $12K itemized makes sense, based on what I entered. I am unclear why turbotax would suggest it, I thought for sure I would take standard deduction this year?
OK I still haven't paid so I can't quite work out the detail, but I see my federal credits are higher if I take the itemized deduction by about $3,600. Not sure what the higher credit is? But that would explain it, since $3,600 in credit is like a $15K deduction at 24% bracket. So it sort of makes sense with the credit factored in? I just don't see which credits require me to itemize. I'll try to sort it out after I file and report back.
it is highly recommended to sort it out before you file.
Don't file an incorrect tax return.
OK I partially see at least.
Both are "correct" but there is some difference in the shadow wold of AMT. I need to compare my 6251 forms closer. But high level I have carry over AMT credits, and if I itemize I can some how take $5K of those, but if I take the standard deduction, I can only take $2K. So yeah credit > deduction. I need to re-read the details on my AMT carry over credit, but I think I'm better off long term taking the standard deduction, the itemized approach, gets me a $600 larger refund, but at the cost pf $3K of AMT carryover credit...
Fun stuff
Turbotax doesn't make this trade off clear, but I guess it's pretty out in the weeds.