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What is the difference between the Standard Deduction and Itemized Deduction? |
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Either deduction allows a taxpayer to reduce their taxable income. It can be a fixed amount that is based on the filing status of the taxpayer (standard deduction) or it can be the sum of allowable deductions (itemized deduction). Examples of itemized deductions include medical and dental expenses, various taxes and interest paid, charitable contributions, casualty and theft losses, and other miscellaneous. It is best to compare the two methods in order to determine which one offers the greatest benefit. The standard deduction for 2010 was $5,700 for taxpayers who are single or married filing separately; $11,400 for married filing joint or qualifying widower; and $8,400 for Head of Household. |
