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Deductions

Itemized Deductions

Certain expenditures qualify as a deduction for your taxes. These expenditures are referred to as itemized deductions.

In general, if your total itemized deductions exceed the standard deduction, you should itemize. This includes these situations:

Most deductions are subject to the 2% of adjusted gross income (AGI) rule. This means the sum of expenditures greater than 2% of your total AGI is deductible in the amount that exceeds the 2%.

If you're under 65, medical and dental expenses that are greater than 10% of your total AGI are deductible in the amount that exceeds the 10%. If either you or your spouse is 65 or older, you can deduct the amount that exceeds 7.5% of your AGI.

Qualifying Expenditures

Individuals Who Must Itemize

  • A married person whose filing status is married filing separately and whose spouse is itemizing deductions.
  • An individual who is a nonresident alien or dual-status alien during any part of the current tax year. Dual status occurs when you are considered both a nonresident and resident alien during the same year.
  • An individual who changes his or her annual accounting cycle and is filing a return for a period of less than 12 months.

For more information, see the Instructions for Schedule A.