As we learned in class this week, while filing taxes, you can either take the standard deduction or itemize. Itemizing is where you list out all allowable expenses that were made throughout the year for tax deduction. This would include things like property taxes, mortgage interests, and charitable donations. In previous years, about 70% took the standard deduction and about 30% itemized on their taxes. As discussed in class, the standard deduction for 2017 tax schedule for single individuals was $6,350 and for married couples was $12,700. Therefore, if you own property or have a lot of expenses throughout the year itemizing would be more beneficial to you.
According to turbotax, this year it is projected that 90% are to take the standard deduction than itemize on tax returns. This is because of the new set of rules that took effect in 2018. I’m sure we were going to talk about the new tax rules in class and compare to 2017 tax schedule, but in the new set of rules the standard deduction has doubled. So for individuals that are claiming taxes independently, the standard tax deduction is $12,000 and for couple filing taxes jointly, the standard tax deduction is $24,000. Therefore, you may get a better tax break if you take the standard deduction.