The standard deduction is based upon income tax filing status. Each filing category is assigned its own standard deduction. A married filing jointly status earns a standard deduction of $10,500, while a single filing status has a standard tax deduction of $5450. A Head of Household filing status has a standard deduction equal to $8000. The standard deduction is the fixed sum the Internal Revenue Service allows as a deduction, based upon the proceeding formulas. As a result, payment of the standard deduction can often result in a higher payment than itemizing deductions. Itemizing deductions helps to avoid overpaying the Internal Revenue Service.
It is a simple procedure of math to realize that you might have legitimate deductions, which you can itemize, that would bring you over the plateau of your standard deduction for your filing status. It is interesting to note that the taxpayers choosing the standard tax deduction, as opposed to itemizing the deductions, are those in the $25,000 to $50,000 bracket. It is also estimated that this tax bracket suffers the most from overpaying taxes. It seems this percentage of the population should choose to avoid overpaying the Internal Revenue Service simply by filing itemized deductions.
When itemizing tax deductions, it is important to keep records and documentation of every expense that might result in a deduction. Keeping vigilant track of records might be the reason so many taxpayers do not choose to pay the standard deduction as opposed to itemizing. A little record keeping, however, seems in order to avoid overpaying the Internal Revenue Service.
