Standard Deduction
A flat dollar amount that reduces taxable income for taxpayers who do not itemize deductions.
What is Standard Deduction?
The standard deduction is a fixed amount set annually by the IRS that reduces a taxpayer's gross income to arrive at taxable income. Taxpayers choose between the standard deduction and itemizing deductions on Schedule A—whichever is larger minimizes tax. For 2024, the standard deduction is $14,600 for Single filers, $29,200 for Married Filing Jointly, and $21,900 for Head of Household. Additional amounts are available for taxpayers who are blind or age 65 and older. The Tax Cuts and Jobs Act of 2017 roughly doubled the standard deduction, significantly reducing the share of taxpayers who benefit from itemizing.
Example
A single teacher earns $60,000. She has $5,000 in mortgage interest, $2,000 in state taxes, and $1,000 in charitable contributions—$8,000 in potential itemized deductions. Because $8,000 is less than the $14,600 standard deduction, she takes the standard deduction, reducing taxable income to $45,400 and saving over $1,300 compared to itemizing.