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What You Should Know About The Standard Deduction

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What You Should Know About The Standard Deduction

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What You Should Know About The Standard Deduction

Now that tax season is here; it’s important to shift your focus on your federal tax return. That means tallying receipts, reviewing expenses, and seeing what deductions you should apply to your taxes. 

When it comes to your deductions, you have two options: standard or itemized. If you’re wondering what a standardized tax deduction is and how you could benefit from using your standard deduction over itemized deductions, this blog post can help. 

What is a standard deduction?

The standard deduction is a dollar amount tax filers can subtract from their income before income tax is applied. Taxpayers can select between itemized deductions and the standard deduction, although they normally choose the one that results in the lowest amount of taxes owed. Individuals, married people, and heads of household who are U.S. citizens or immigrants and are tax residents in the United States may claim the standard deduction. The standard deduction is determined by filing status.

How often does the standard deduction change? 

The standard deduction amounts are adjusted annually to account for inflation, so your standard deduction for this tax year will be higher than it was on your 2021 tax return. 

Who cannot claim the standard deduction? 

Not all taxpayers qualify for the standard deduction. If you are married and filing separately from your spouse, and they itemize their deductions, you cannot claim the standard deduction. You also cannot claim the standard deduction if you are a nonresident or dual-status alien during the year, file a return for less than 12 months because you change your annual accounting period, or are filing for a trust, common trust fund, partnership, or an estate.

Typically, If the total value of itemized deductions is higher than the standard deduction, you should itemize. Otherwise, claiming the standard deduction is in your best interest.

What are the standard deduction amounts for the 2022 tax year? 

How much the standard deduction is worth depends on your filing status, whether you're 65 or older, blind, and whether another taxpayer can claim you as a dependent on their tax return. For 2022 tax returns, the standard deduction amounts go as follows: 

  • Filing Status: Single; Married Filing Separately. 2022 Standard Deduction: $12,950
  • Filing Status: Married Filing Jointly; Surviving Spouse. 2022 Standard Deduction: $25,900
  • Filing Status: Head of Household. 2022 Standard Deduction: $19,400

Taxpayers over the age of 65 or who are blind will be able to claim an extra $1,400 standard deduction in 2022. The additional deduction amount will be doubled if you are both 65 and blind.

If you can be claimed as a dependant by another taxpayer, your 2022 standard deduction will be capped to the greater of $1,150 or your earned income plus $400 but not more than your filing status's basic standard deduction.

How can Taxfyle help? 

Taxes are complicated. While the standard deduction may be an easy way to get more back on your tax return, it’s not always the ideal solution. Luckily, we can connect you with a tax expert that knows how to handle any unique situation. 

With Taxfyle, you get peace of mind when you file your taxes. That’s because you don’t need to stress about the hard part of filing taxes. Instead, our Pros do the work for you. 

This tax season, don’t be stressed. Have a Pro file for you. 

Legal Disclaimer

Tickmark, Inc. and its affiliates do not provide legal, tax or accounting advice. The information provided on this website does not, and is not intended to, constitute legal, tax or accounting advice or recommendations. All information prepared on this site is for informational purposes only, and should not be relied on for legal, tax or accounting advice. You should consult your own legal, tax or accounting advisors before engaging in any transaction. The content on this website is provided “as is;” no representations are made that the content is error-free.

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published

January 23, 2023

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Steven de la Fe, CPA

Steven de la Fe, CPA

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