Choosing the larger deduction
Taxpayers take either the standard deduction (a fixed amount based on filing status) or itemize deductions on Schedule A. The standard deduction for 2025 is roughly $14,000 for single filers and $28,000 for joint filers, adjusted annually for inflation. Itemizing is only worthwhile if deductible expenses exceed this threshold.
Itemizable expenses include state and local taxes (capped at $10,000), mortgage interest, charitable contributions, and some medical expenses above 7.5% of adjusted gross income. The cap on state and local taxes is the main factor preventing higher-income households from itemizing.
Why most filers now take the standard
The standard deduction nearly doubled in 2017 as part of the Tax Cuts and Jobs Act, and today only about 10-15% of taxpayers itemize. Unless you have a mortgage, significant charitable giving, or live in a high-tax state with deductible property taxes, you likely benefit from taking the standard.
Some taxpayers use bunching strategies, combining multiple years of charitable donations into one year to exceed the standard deduction threshold in that year only, then using the standard in other years. This approach requires flexibility in charitable giving timing.