40:
592:
uniforms, or meals can be deducted. Non-cash donations valued at more than $ 500 require special substantiation on a separate form. Non-cash donations are deductible at the lesser of the donor's cost or the current fair market value, unless the non-cash donation has been held for longer than a year, in which case it can only be deducted at fair market value. If appreciated stock is donated, the deduction is the fair market value of the stock on the date of the donation and the taxpayer never has to pay taxes on the inherent gain.
292:
654:
in various gambling activities during the year and loses $ 3,500 in other gambling activities in that year can deduct only $ 3,000 of the losses against the $ 3,000 in income, resulting in a break-even gambling activity for tax purposes for that year—with no deduction for the remaining $ 500 excess loss.) Unused non-professional gambling losses may not be carried forward to subsequent tax years. However, professional gamblers are allowed to deduct losses from other income.
427:(AMT). If the taxpayer claims the standard deduction for regular income tax, he or she cannot itemize deductions for the AMT. Thus, for a taxpayer who pays the AMT (i.e., their AMT is higher than regular tax), it may be better to itemize deductions, even if it produces a result that is less than the standard deduction.
653:
losses, but only to the extent of gambling income (For example, a person who wins $ 1,000 in various gambling activities during the tax year and loses $ 800 in other gambling activities can deduct the $ 800 in losses, resulting in net gambling income of $ 200. By contrast, a person who wins $ 3,000
591:
to allowable recipients; this deduction is limited to 30%-60% of AGI, depending on the characterization of the recipient. Donations can be money or goods but the value of donated services provided cannot be deducted. Reasonable expenses necessary to provide donated services such as mileage, special
673:
Miscellaneous itemized deductions are subject to a 2% floor, a.k.a. the "2% Haircut". A taxpayer can only deduct the amount of miscellaneous itemized deductions that exceed 2% of their adjusted gross income. For example, if a taxpayer has adjusted gross income of $ 50,000 with $ 4,000 in
390:
If the taxpayer is filing as "married, filing separately," and his or her spouse itemizes, then the taxpayer cannot claim the standard deduction. In other words, a taxpayer whose spouse itemizes deductions must either itemize as well or claim "0" (zero) as the amount of the standard
682:
Job-related clothing or equipment, such as steel-toed boots, hardhats, uniforms (if they are not suited for social wear: suits and tuxedoes are not deductible, even if the taxpayer does not like to wear them, but nurses' and police uniforms are), tools and equipment required for
677:
There are 12 deductions listed in 26 U.S.C. § 67(b). These are not miscellaneous itemized deductions, and thus not subject to the 2% floor (although they may have their own rules). Any deduction not found in section 67(b) is a miscellaneous itemized deduction. Examples include:
565:
interest expense on debt incurred to purchase up to two homes, subject to limits (up to $ 1,000,000 in purchase debt, or $ 100,000 in home equity loans for loans taken out on or before
December 15, 2017, or $ 750,000 in purchase debt for loans taken out after December 15, 2017)
451:. (For example, a taxpayer with an adjusted gross income of $ 20,000 and medical expenses of $ 5,000 would be eligible to deduct $ 3,500 of their medical expenses ($ 20,000 X 7.5% = $ 1,500; $ 5,000 - $ 1,500 = $ 3,500). Allowable medical expenses include:
431:
Deductions are reported in the tax year in which the eligible expenses were paid. For example, an annual membership fee for a professional association paid in
December 2009 for the year 2010 is deductible in the year 2009.
689:
Unreimbursed work-related expenses, such as travel or education (so long as the education does not qualify the taxpayer for a new line of work; law school, for example, is not deductible) (repealed, effective
January 1,
364:
for their filing status to arrive at the taxable income. In other words, the taxpayer may generally deduct the total itemized deduction amount or the applicable standard deduction amount, whichever is greater.
461:
Payments to doctors, dentists, surgeons, chiropractors, psychologists, counselors, physical therapists, osteopaths, podiatrists, home health care nurses, cost of care for chronic cognitive impairment
454:
Capital expenditures that are advised by a physician, where the facility is used primarily by the patient alone and the expense is reasonable (e.g., a swimming pool for someone with a
397:
If the amounts of the itemized deductions and the standard deduction do not differ much, the taxpayer may take the standard deduction to reduce the possibility of adjustment by the
846:
537:, including vehicle registration fee, if assessed by reference to the value of the property. This amount is in addition to the previous choice of either income or sales tax.
588:
799:
626:
Casualty and theft losses, to the extent that they exceed 10% of the taxpayer's AGI (in aggregate), and $ 100 (per event, $ 500 starting tax year 2009)
435:
The United States has a comparatively large and complicated number of deductions owing to policymakers' preference to pass policy through the tax code.
572:
paid to discount the interest rate on up to two homes; points paid upon acquisition are immediately deductible, but points paid on a refinance must be
356:(AGI), taxpayers can itemize deductions (from a list of allowable items) and subtract those itemized deductions from their AGI amount to arrive at the
164:
447:
Medical expenses, only to the extent that the expenses exceed 7.5% (as of the 2018 tax year, when this was reduced from 10%) of the taxpayer's
484:
Payments for devices needed to treat or compensate for a medical condition (crutches, wheelchairs, prescription eyeglasses, hearing aids)
121:
585:
accounts), up to the amount of income reported from investments; the balance is deferred until more investment income is declared
872:
908:
705:
The amount of itemized deductions was limited and phased out for high income taxpayers for tax years before 2017; however, the
61:
49:
760:
320:
278:
201:
738:
196:
151:
96:
674:
miscellaneous itemized deductions, the taxpayer can only deduct $ 3,000, since the first $ 1,000 is below the 2% floor.
402:
66:
534:
222:
176:
528:
181:
146:
86:
352:
Most taxpayers are allowed a choice between itemized deductions and the standard deduction. After computing their
91:
76:
71:
785:
706:
664:
517:
186:
81:
31:
581:
Investment interest expenses (interest paid to borrow money used for investing, including interest paid on
238:
116:
693:
Fees paid to tax preparers, or to purchase books or software used to determine and calculate taxes owed
616:
401:(IRS). The amount of the standard deduction cannot be changed following an audit unless the taxpayer's
342:
253:
126:
520:, but the entire sum of this category is capped at $ 10,000 starting in tax year 2018. These include:
380:
313:
876:
472:
398:
101:
464:
Premiums for medical insurance (but not if paid by someone else, or with pre-tax money such as in
424:
136:
131:
56:
573:
394:
The taxpayer must have maintained the records required to substantiate the itemized deductions.
23:
496:
448:
368:
The choice between the standard deduction and itemizing involves a number of considerations:
353:
334:
106:
455:
306:
296:
233:
8:
718:
263:
913:
361:
346:
228:
39:
862:
Chirelstein, Marvin A., Federal Income
Taxation 198 (Foundation Press, 10th Ed., 2005)
510:(except to restore normal appearance after an injury or to treat a genetic deformity)
384:
645:. This facilitated amendments to 2011 tax returns to claim a casualty tax deduction.
667:, miscellaneous itemized deductions are not deductible for tax years 2018 to 2025.
638:
582:
524:
507:
171:
893:
658:
642:
569:
416:, he or she would prefer not to prepare (or pay to prepare) the more complicated
273:
258:
746:
696:
Subscriptions to newspapers or other periodicals directly relating to one's job
553:
465:
357:
902:
562:
141:
111:
341:
are eligible expenses that individual taxpayers can claim on federal income
739:"Volunteer Income Tax Assistors/Tax Counseling for the Elderly (VITA/TCE)"
630:
501:
408:
If the taxpayer is otherwise eligible to file a shorter tax form such as
376:
345:
and which decrease their taxable income, and are claimable in place of a
634:
548:
214:
804:
417:
847:
2018 Tax Reform Series: Tax Law
Changes to Employee Fringe Benefits
650:
248:
873:"Tax reform affects if and how taxpayers itemize their deductions"
372:
Only a taxpayer eligible for the standard deduction can choose it.
543:
479:
268:
243:
191:
761:"Tax reform brought significant changes to itemized deductions"
409:
659:
Miscellaneous itemized deductions (Tax Years 2017 and earlier)
413:
487:
Mileage for travel to and from doctors and medical treatment
438:
595:
Eligible recipients for charitable contributions include:
423:
The standard deduction is not allowed for calculating the
576:(deducted in equal parts over the lifetime of the loan)
641:
were declared disaster areas for tax year 2011, after
598:
Churches, synagogues, mosques, other houses of worship
420:
and the associated
Schedule A for itemized deductions.
786:"Making sense of the new cap on state tax deductions"
504:
memberships (to improve general health and fitness)
800:"Investing: How to get catastrophe tax deduction"
900:
360:. Alternatively, they can elect to subtract the
383:are eligible to claim the standard deduction.
458:, an elevator for someone with heart disease)
314:
601:Federal, state, or local government entities
321:
307:
709:eliminated the phaseout and limitations.
493:Non-deductible medical expenses include:
439:Examples of allowable itemized deductions
845:Schwartz, Bruce H. (January 3, 2018). "
821:
531:paid during the tax year, but not both.
901:
604:Fraternal or veterans' organizations
478:Payments for prescription drugs and
16:Type of expense in American tax law
13:
812:
14:
925:
887:
609:Non-eligible recipients include:
475:, depending on the taxpayer's age
223:Automated payment transaction tax
290:
87:Generation-skipping transfer tax
38:
865:
856:
839:
830:
792:
778:
753:
731:
700:
443:Allowable deductions include:
102:Internal Revenue Service (IRS)
1:
909:Taxation in the United States
707:Tax Cuts and Jobs Act of 2017
665:Tax Cuts and Jobs Act of 2017
187:State and local tax deduction
32:Taxation in the United States
239:Efficient Taxation of Income
7:
712:
670:For tax years before 2018:
617:political action committees
527:or state and local general
107:Internal Revenue Code (IRC)
10:
930:
518:State and local taxes paid
490:Necessary travel expenses
381:resident for tax purposes
877:Internal Revenue Service
724:
589:Charitable contributions
473:long-term care insurance
471:Premiums for qualifying
399:Internal Revenue Service
297:United States portal
165:State and local taxation
127:Constitutional authority
22:This article is part of
615:Political campaigns or
425:alternative minimum tax
57:Alternative minimum tax
497:Over-the-counter drugs
254:Hall–Rabushka flat tax
449:adjusted gross income
354:adjusted gross income
335:United States tax law
279:Border-adjustment tax
879:. November 14, 2018.
853:. Jackson Lewis P.C.
851:Benefits Law Advisor
456:degenerative disease
234:Competitive Tax Plan
788:. 20 December 2017.
719:Two-percent haircut
540:but not including:
339:itemized deductions
264:Taxpayer Choice Act
554:Fines or penalties
385:Nonresident aliens
375:U.S. citizens and
362:standard deduction
347:standard deduction
215:Federal tax reform
894:IRS Mileage Rates
836:26 U.S.C. § 67(b)
387:are not eligible.
331:
330:
132:Taxpayer standing
62:Capital gains tax
921:
881:
880:
869:
863:
860:
854:
843:
837:
834:
828:
825:
819:
816:
810:
809:
796:
790:
789:
782:
776:
775:
773:
771:
757:
751:
750:
745:. Archived from
735:
525:state income tax
508:Cosmetic surgery
349:, if available.
323:
316:
309:
295:
294:
293:
225:
202:State tax levels
172:State income tax
117:Revenue by state
50:Federal taxation
42:
19:
18:
929:
928:
924:
923:
922:
920:
919:
918:
899:
898:
890:
885:
884:
871:
870:
866:
861:
857:
844:
840:
835:
831:
826:
822:
817:
813:
798:
797:
793:
784:
783:
779:
769:
767:
759:
758:
754:
737:
736:
732:
727:
715:
703:
661:
643:Hurricane Sandy
570:Discount points
466:Cafeteria plans
441:
327:
291:
289:
284:
283:
274:Value added tax
259:Kemp Commission
221:
217:
207:
206:
167:
157:
156:
52:
17:
12:
11:
5:
927:
917:
916:
911:
897:
896:
889:
888:External links
886:
883:
882:
864:
855:
838:
829:
820:
818:26 U.S.C. § 67
811:
791:
777:
752:
749:on 2004-06-15.
729:
728:
726:
723:
722:
721:
714:
711:
702:
699:
698:
697:
694:
691:
687:
684:
660:
657:
656:
655:
648:
647:
646:
629:Many areas of
624:
623:
622:
621:
620:
613:
607:
606:
605:
602:
599:
586:
579:
578:
577:
560:
559:
558:
557:
556:
551:
546:
538:
535:Property taxes
532:
515:
514:
513:
512:
511:
505:
499:
491:
488:
485:
482:
476:
469:
462:
459:
440:
437:
429:
428:
421:
406:
395:
392:
388:
373:
358:taxable income
329:
328:
326:
325:
318:
311:
303:
300:
299:
286:
285:
282:
281:
276:
271:
266:
261:
256:
251:
246:
241:
236:
231:
226:
218:
213:
212:
209:
208:
205:
204:
199:
197:Land value tax
194:
189:
184:
179:
174:
168:
163:
162:
159:
158:
155:
154:
149:
144:
139:
134:
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119:
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109:
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89:
84:
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69:
64:
59:
53:
48:
47:
44:
43:
35:
34:
28:
27:
15:
9:
6:
4:
3:
2:
926:
915:
912:
910:
907:
906:
904:
895:
892:
891:
878:
874:
868:
859:
852:
848:
842:
833:
824:
815:
807:
806:
801:
795:
787:
781:
766:
762:
756:
748:
744:
740:
734:
730:
720:
717:
716:
710:
708:
695:
692:
688:
685:
681:
680:
679:
675:
671:
668:
666:
652:
649:
644:
640:
636:
632:
628:
627:
625:
618:
614:
611:
610:
608:
603:
600:
597:
596:
594:
593:
590:
587:
584:
580:
575:
571:
568:
567:
564:
563:Mortgage loan
561:
555:
552:
550:
547:
545:
542:
541:
539:
536:
533:
530:
526:
522:
521:
519:
516:
509:
506:
503:
500:
498:
495:
494:
492:
489:
486:
483:
481:
477:
474:
470:
467:
463:
460:
457:
453:
452:
450:
446:
445:
444:
436:
433:
426:
422:
419:
415:
411:
407:
404:
403:filing status
400:
396:
393:
389:
386:
382:
378:
374:
371:
370:
369:
366:
363:
359:
355:
350:
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324:
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312:
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305:
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288:
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280:
277:
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257:
255:
252:
250:
247:
245:
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230:
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219:
216:
211:
210:
203:
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185:
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170:
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153:
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148:
145:
143:
140:
138:
135:
133:
130:
128:
125:
123:
120:
118:
115:
113:
112:IRS tax forms
110:
108:
105:
103:
100:
98:
95:
93:
90:
88:
85:
83:
80:
78:
75:
73:
70:
68:
67:Corporate tax
65:
63:
60:
58:
55:
54:
51:
46:
45:
41:
37:
36:
33:
30:
29:
25:
21:
20:
867:
858:
850:
841:
832:
823:
814:
803:
794:
780:
768:. Retrieved
764:
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747:the original
742:
733:
704:
676:
672:
669:
662:
549:Excise taxes
442:
434:
430:
367:
351:
338:
332:
177:Property tax
765:www.irs.gov
743:www.irs.gov
701:Limitations
631:Connecticut
612:Individuals
529:sales taxes
502:Health club
343:tax returns
97:Payroll tax
903:Categories
686:Union dues
635:New Jersey
391:deduction.
152:Resistance
92:Income tax
77:Excise tax
72:Estate tax
914:Tax terms
827:26 U.S.C.
805:USA Today
574:amortized
544:Use taxes
418:Form 1040
182:Sales tax
713:See also
663:Per the
651:Gambling
639:New York
405:changes.
379:who are
249:Flat tax
82:Gift tax
24:a series
770:12 July
523:Either
480:insulin
269:USA Tax
244:FairTax
192:Use tax
147:Evasion
142:Protest
122:History
619:(PACs)
583:margin
410:1040EZ
377:aliens
333:Under
725:Notes
414:1040A
229:9–9–9
137:Court
772:2023
690:2018
683:work
637:and
849:".
412:or
905::
875:.
802:.
763:.
741:.
633:,
337:,
26:on
808:.
774:.
468:)
322:e
315:t
308:v
Text is available under the Creative Commons Attribution-ShareAlike License. Additional terms may apply.
