With the tax year winding down, it’s time to evaluate your personal tax situation. Will you claim the standard deduction or itemize deductions on your 2024 tax return? The answer matters when it comes to receiving tax benefits for your charitable contributions. In general, taxpayers should claim the higher of 1) the standard deduction, or 2) the amount of your qualified itemized deductions on your annual federal tax return.
The standard deduction is adjusted annually for inflation. For 2024, the standard deduction is:
- $14,600 for single people and married couples who file separately,
- $21,900 for heads of households, and
- $29,200 for married couples who file jointly.
For 2024, taxpayers who are age 65 or older or blind can claim an additional standard deduction of $1,950 ($1,550 if married).
Alternatively, you might decide to claim itemized deductions for such items as:
- Interest on mortgage debt incurred to purchase, build or improve your principal residence and a second residence,
- State and local taxes, including property tax and either income tax or sales tax,
- Personal casualty and theft losses due to a federally declared disaster,
- Medical expenses in excess of 7.5% of AGI, and
- Charitable contributions, subject to the limits listed above.
In addition to temporarily increasing the standard deduction, the Tax Cuts and Jobs Act (TCJA) includes provisions limiting certain itemized deductions. For example, through 2025, the TCJA limits your entire deduction for state and local taxes to $10,000 ($5,000 if you’re married and filing separately). It also places restrictions on personal casualty and theft losses and mortgage interest deductions, along with suspending miscellaneous itemized deductions through 2025 for expenses such as certain professional fees, investment expenses and unreimbursed employee business expenses. Under prior law, miscellaneous itemized deductions were subject to a 2%-of-AGI floor.
Your professional tax advisor can help you tally up your expected itemized deductions for 2024 to see where you stand for the tax year. He or she can also recommend strategies to lower your taxes.
