Deductions

Jine
Jine Member Posts: 3 Newcomer
in Credits/Deductions

What deductions can you claim in your taxes? and it is necessary to add them in your tax return?

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Answers

  • Tanner
    Tanner FreeTaxUSA Agent Posts: 6

    Hello Jine,

    You can claim two types of deductions: 1) the Standard Deduction, and 2) Itemized Deductions.

    The Standard Deduction is a fixed amount set by the IRS, while Itemized Deductions allow you to deduct specific expenses such as medical costs, mortgage interest, and charitable contributions.

    You must choose either the Standard Deduction or Itemized Deductions on your tax return, typically selecting the option that results in the higher deduction.

    If you don't have many Itemized Deductions, you can claim the Standard Deduction, which may vary depending on your filing status.

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  • Taxlady06
    Taxlady06 FreeTaxUSA Agent Posts: 69

    When you file a tax return, deductions reduce your taxable income. Most people take the standard deduction, which lets you subtract a set amount from your income based on your filing status. 

    The standard deduction amounts for 2024 are:
    -Married filing jointly $29,200
    -Single and married individuals filing separately $14,600
    -Head of Household $21,900

    If your deductible expenses and losses are more than the standard deduction, you can save money by deducting them one-by-one from your income, this is called itemizing your deductions. FreeTaxUSA will walk you through entering your deductions and will help determine which option will result in the best outcome based on your situation.

    The IRS has many itemized deductions that you can use to reduce your taxable income. The most common are mortgage interest, charitable contributions, medical and dental expenses over 7.5% of AGI, and state & local taxes.

    You can choose to skip entering your itemized deductions, but if you're also filing a state return, Itemized Deductions may lower your state taxes even if you end up taking the Standard Deduction on your federal return.

    We recommend that you enter all Itemized Deductions that apply to you, just to be sure you're getting the best deduction possible. However, if you're confident that your Standard Deduction is larger than your Itemized Deductions, you can skip entering them.

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