Introduction

When it comes time to file your taxes, it’s important to know the difference between standard and itemized deductions. Both have their pros and cons, and it’s a good idea to choose one or the other based on your tax situation.

Understanding standard deductions and itemized deductions

The standard deduction is a fixed amount that you can deduct from your income, even if you don’t itemize your deductions. The amount of your credit is based on the information you entered

and whether or not you are blind. For example, if you’re single and 65 years old in 2019 and have no dependents, the standard deduction for this year is $12,200.

The IRS allows taxpayers who itemize their taxes to claim their expenses as deductions–but only if they exceed the standard deduction amount for their filing status. If not enough of these expenses add up to surpass the standard deduction amount (or they do but they also include an above-the-line adjustment), then it makes more sense for them not just to take advantage of being able to itemize but actually do so!

Comparing standard vs. itemized deductions: Which saves you more money?

You may be wondering what the difference between the standard and itemized deductions is, and how you can use them to your advantage. The standard deduction is a set amount that all taxpayers can claim on their tax returns without having to itemize their expenses. The IRS allows you to choose either the standard deduction or an itemized list of deductions–but not both.

The first step in calculating either type of deduction is determining whether or not you qualify for it at all by meeting certain criteria set by law:

• You must have paid for qualified medical expenses during the year that was more than 7.5% (for 2018) of your adjusted gross income (AGI). This includes costs related to prescription drugs, contact lenses, and glasses, hearing aids, or similar devices; long-term care insurance premiums if they were not paid by another person such as an employer; transportation used primarily for medical care; mobility aids like wheelchairs; special diets imposed upon people with disabilities due solely because those disabilities prevent them from eating normal foods without assistance.

How to choose between standard and itemized deductions

If you have a lot of deductions to claim, it’s better to itemize. If you have more than $5,000 in itemized deductions and your income is below the standard deduction amount, then it makes sense for you to use the standard deduction instead of itemizing your taxes.

Example: You’re single with no dependents and earn $40,000 per year. Your total allowable tax deductions come out to $8,000 (including state income tax). If your employer offers a 401(k) plan with an employer match or other benefits that increase the value of 401(k) contributions, this can also be considered when determining whether or not it makes sense for someone like yourself who has little knowledge about investing their money wisely should take advantage of such opportunities by contributing every year until they reach certain goals–even though doing so may mean losing some benefits from being able to deduct those contributions later on the down road!

When to take standard deductions vs. itemized deductions

If you have a lot of deductions, itemizing could be worth it. This is especially true if your income is high and the standard deduction would not be enough to cover them all. For example, if your total itemized deductions are $20,000 or more ($10,000 for single filers), then it might be worthwhile to do so.

As always with taxes: consult a professional!

What if you have a high income and large deductions? You may still be able to take advantage of itemizing. If your total itemized deductions are $100,000 or more ($50,000 for single filers), then you’re in luck! You can still claim the standard deduction and deduct anything above that amount. For example: say your standard deduction is $10,000 (single filer), but your total itemized deductions come out to $100,000.

Maximizing tax savings: Standard vs. itemized deductions

You should be aware of the difference between standard and itemized deductions. When you file your taxes, you can choose to use either one or both methods of calculating your taxable income.

Standard deductions are the flat amount that reduces your taxable income by a set amount each year. For example, if your total gross income was $50,000 in 2018 and you were single without any children at home (and therefore did not qualify for the child tax credit), then your standard deduction would be $12,000–the same amount regardless of whether or not you had any other deductions such as charitable contributions or medical bills paid out-of-pocket during 2018.*

Itemized Deductions vs Standard Deductions – What’s Better?

Standard deductions and itemized deductions are two kinds of tax breaks that people are eligible to claim either one can use.

The standard deduction is a fixed amount you can deduct from your gross income. It’s a little like getting money back from the government, but it’s not actually the same thing as refunds or rebates that come from overpaying for something.

Standard deductions are usually higher than itemized deductions–in 2018, the standard deduction was $12,000 for single filers and $24,000 for married couples filing jointly; however, there are some exceptions to this rule: If you’re 65 or older (or blind), then your standard deduction will be increased by $1 for every $2 of earned income above a certain threshold depending on your age bracket (for example: if you’re 70 years old and earn $40k per year working part-time at Home Depot while also collecting Social Security benefits).

Itemized deductions are simply all eligible expenses you have throughout the year–they include things like mortgage interest payments on primary residences; charitable donations made directly from checking accounts or credit cards via sites like GoFundMe; medical expenses exceeding 10% of adjusted gross income (AGI); state sales taxes paid within one year’s time period ending December 31st each year…and so forth!

Conclusion

In conclusion, the standard deduction is a great way to save money on your taxes. However, if you have additional expenses that are not covered by the standard deduction (such as mortgage interest), then it may be worth itemizing your deductions instead. It’s important that you know your personal financial situation before making this decision so that you can find out which method will provide more tax savings for your household.