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2020 STANDARD DEDUCTION VS ITEMIZED DEDUCTION

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Surya Padhi
Surya Padhi

The document discusses the standard deduction versus itemized deductions for the 2020 tax year. It provides information on the standard deduction amounts for single, married, and head of household filers. It notes that taxpayers can choose to take the standard deduction or itemize deductions if their qualifying expenses exceed the standard amount. Itemized deductions include mortgage interest, property taxes, state taxes, medical expenses, and charitable donations. The document advises taxpayers to calculate their itemized deductions and compare to the standard deduction to determine the optimal strategy.

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2020 TAX TIPS STANDARD DEDUCTION VS ITEMIZED DEDUCTION
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 Content: Disclaimer About Author 2020 TAX STANDARD vs ITEMIZED DEDUCTION
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 Disclaimer
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 Disclaimer Disclaimer: The content of this document is only reference purpose and intended to help and cover the topic in a short period of time. Author assume no responsibility for errors or omissions in this document. This preview is provided without a warranty of any kind, either express or implied, including but not limited to the implied warranties of merchantability, fitness for a particular purpose, or non-infringement. Author have no liability for damages of any kind including without limitation direct, special, indirect, or consequential damages that may result from the use of these materials.
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 About Author
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 About Author Surya Padhi Chartered Accountant, Certified Public Accountant, MBA Contact : SuryaPadhiCPA@Gmail.Com
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 STANDARD VS ITEMIZED DEDUCTION
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 STANDARD DEDUCTION The standard deduction represents a fixed amount that will be deducted from income to arrive base amount for income tax payable. The standard deduction is dependent on your income, age, and filing status, and changes each year. In 2019, the standard deduction is: For single or married filing separately $12,200 For married filing jointly or qualifying widow(er) $24,400 For head of household $18,350 Your standard deduction increases if youre blind or age 65 or older. In 2019, it increases by $1,650 if youre single or head of household and by $1,300 if youre married or a qualifying widow(er)
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 STANDARD DEDUCTION The standard deduction: Allows you a deduction even if you have no expenses that qualify for claiming itemized deductions. Eliminates the need to itemize deductions, like medical expenses and charitable donations. Lets you avoid keeping records and receipts of your expenses in case youre audited by the IRS.
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 ITEMIZED DEDUCTION Itemized deductions also reduce your adjusted gross income (AGI). You might benefit from itemizing your deductions on Form 1040 if you: Have itemized deductions that total more than the standard deduction you would receive (like in the example above) Had large, out-of-pocket medical and dental expenses Paid mortgage interest and real estate taxes on your home Had large, uninsured casualty (fire, flood, wind) or theft losses Made large contributions to qualified charities Had large, unreimbursed miscellaneous expenses However all these items have certain limitation.
http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 When to Claim ITEMIZED DEDUCTION If your standard deduction is less than your itemized deductions Try this quick check. Use the numbers you find on IRS Form 1098, the Mortgage Interest Statement (you typically get this from your mortgage company at the end of the year). Compare your mortgage interest deduction amount to the standard deduction. Property taxes, state income taxes or sales taxes, and charitable donations can be deductible, too, if you itemize. Run the numbers both ways. If youre using tax software, its probably worth the time to answer all the questions about itemized deductions that might apply to you.
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2020 STANDARD DEDUCTION VS ITEMIZED DEDUCTION

  • 1. 2020 TAX TIPS STANDARD DEDUCTION VS ITEMIZED DEDUCTION
  • 2. http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 Content: Disclaimer About Author 2020 TAX STANDARD vs ITEMIZED DEDUCTION
  • 4. http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 Disclaimer Disclaimer: The content of this document is only reference purpose and intended to help and cover the topic in a short period of time. Author assume no responsibility for errors or omissions in this document. This preview is provided without a warranty of any kind, either express or implied, including but not limited to the implied warranties of merchantability, fitness for a particular purpose, or non-infringement. Author have no liability for damages of any kind including without limitation direct, special, indirect, or consequential damages that may result from the use of these materials.
  • 6. http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 About Author Surya Padhi Chartered Accountant, Certified Public Accountant, MBA Contact : SuryaPadhiCPA@Gmail.Com
  • 7. http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 STANDARD VS ITEMIZED DEDUCTION
  • 8. http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 STANDARD DEDUCTION The standard deduction represents a fixed amount that will be deducted from income to arrive base amount for income tax payable. The standard deduction is dependent on your income, age, and filing status, and changes each year. In 2019, the standard deduction is: For single or married filing separately $12,200 For married filing jointly or qualifying widow(er) $24,400 For head of household $18,350 Your standard deduction increases if youre blind or age 65 or older. In 2019, it increases by $1,650 if youre single or head of household and by $1,300 if youre married or a qualifying widow(er)
  • 9. http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 STANDARD DEDUCTION The standard deduction: Allows you a deduction even if you have no expenses that qualify for claiming itemized deductions. Eliminates the need to itemize deductions, like medical expenses and charitable donations. Lets you avoid keeping records and receipts of your expenses in case youre audited by the IRS.
  • 10. http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 ITEMIZED DEDUCTION Itemized deductions also reduce your adjusted gross income (AGI). You might benefit from itemizing your deductions on Form 1040 if you: Have itemized deductions that total more than the standard deduction you would receive (like in the example above) Had large, out-of-pocket medical and dental expenses Paid mortgage interest and real estate taxes on your home Had large, uninsured casualty (fire, flood, wind) or theft losses Made large contributions to qualified charities Had large, unreimbursed miscellaneous expenses However all these items have certain limitation.
  • 11. http://cpa.suryapadhi.com/ | suryapadhicpa@gmail.com | 908 300 9193 When to Claim ITEMIZED DEDUCTION If your standard deduction is less than your itemized deductions Try this quick check. Use the numbers you find on IRS Form 1098, the Mortgage Interest Statement (you typically get this from your mortgage company at the end of the year). Compare your mortgage interest deduction amount to the standard deduction. Property taxes, state income taxes or sales taxes, and charitable donations can be deductible, too, if you itemize. Run the numbers both ways. If youre using tax software, its probably worth the time to answer all the questions about itemized deductions that might apply to you.