Standard Deduction or Itemize? How to Decide

Two ways to reduce taxable income

Deductions lower the income you pay tax on. Every taxpayer can choose between two approaches.

The standard deduction is a flat amount that depends on filing status. For 2026, it’s $16,100 for single filers, $32,200 for married couples filing jointly and $24,150 for heads of household. People 65 or older, or blind, get an additional amount.

Itemizing means adding up specific deductible expenses instead. The main ones are mortgage interest on up to $750,000 of home debt, state and local taxes, charitable gifts, and medical expenses above 7.5% of adjusted gross income.

You take whichever is larger. You can’t take both.

Why most people don’t itemize

The standard deduction is large enough that most households’ eligible expenses don’t exceed it. The deduction for state and local taxes is also capped, at $40,400 for 2026, with a lower cap for households whose income is above $505,000.

This is why the advice that homeowners save on taxes is less true than it once was. Mortgage interest only saves you tax to the extent that your itemized total is higher than the standard deduction.

An example

Imagine a single homeowner with an adjusted gross income of $95,000. In 2026, they pay $9,000 in mortgage interest and $7,500 in state income and property taxes, and give $1,200 in cash to charity.

Starting in 2026, itemizers can deduct only the part of their charitable gifts above 0.5% of adjusted gross income. Here, that floor is $475, so $725 of their gifts counts.

Their itemized deductions total $17,225. If they took the standard deduction of $16,100 instead, they could still deduct $1,000 of their cash gifts (more on that below), for $17,100. Itemizing comes out only $125 ahead, which in the 22% bracket saves them about $27.50 in federal income tax. That’s far less than the $9,000 of mortgage interest might suggest, and with slightly lower expenses the standard deduction would win.

If the same person were married filing jointly with a standard deduction of $32,200, the same expenses wouldn’t come close, and itemizing wouldn’t help.

Changes worth knowing about

Some deductions are available whichever approach you choose. Starting in 2026, people who take the standard deduction can also deduct up to $1,000 in cash gifts to qualifying charities ($2,000 for married couples filing jointly). Gifts to donor-advised funds don’t qualify. A separate deduction of up to $6,000 is available through 2028 to eligible people 65 and older, reduced at higher incomes.

Contributions to a traditional 401(k) or IRA, and to a health savings account, also reduce taxable income without itemizing.

How to check for yourself

Add up your mortgage interest (on Form 1098 from your lender), state and local income or sales taxes and property taxes up to the cap, and charitable gifts above the 0.5% floor, plus large medical expenses if they apply. If the total is close to or above your standard deduction plus any cash gifts you could deduct without itemizing, it’s worth comparing carefully. Tax software does this comparison automatically, but knowing the numbers helps you plan, for example by timing large charitable gifts into a single year.

The takeaway

The standard deduction is the better choice for most people, which is why your receipts may not change your tax bill. Itemizing helps when mortgage interest, state and local taxes and giving together exceed the standard deduction, and even then it saves only the amount above it, at your marginal rate.

Written by the Maxint Content team and reviewed by the Maxint Editor team. How we create our content

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This article is general education about US personal finance, based on the assumptions and sources described in it. It isn’t financial, tax or legal advice, and examples use hypothetical people and figures.