How does the itemized deduction differ from the standard deduction?
The federal standard deduction is a fixed dollar amount, based on your filing status and age, that the IRS lets you take off (deduct) from your taxable income.
On the other hand, the itemized deduction allows you to list (itemize) your deductions on Schedule A.
The IRS lets you choose either the "bundled" standard deduction or the "a la carte" itemized deduction. Naturally, most taxpayers want the one that gives them the most money back. After you've completed the Deductions & Credits section of TurboTax, we'll let you know which deduction gives you the biggest tax break.
By the way, we estimate that close to 90% of taxpayers will be taking the higher standard deduction this year (compared to around 70% last year) as a direct result of tax reform legislation.