Guide to Tax Deductions and Credits

Introduction

Deductions reduce your taxable income. Credits reduce your tax bill dollar-for-dollar. Understanding the difference — and which ones you qualify for — is the highest-leverage tax move most filers can make.

Standard vs. itemized

For 2025 the standard deduction is $14,600 for single filers and $29,200 for married filing jointly. Only itemize if your eligible expenses exceed that.

Above-the-line deductions

These come off your gross income before AGI is calculated, which means you get them whether you itemize or not. Student loan interest, HSA contributions, and educator expenses are common examples.