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Standard Deductions for 2023 Tax Returns

Michelle Black
By
Michelle Black
Michelle Black

Michelle Black

Contributor

Michelle is a credit expert, freelance writer and founder of CreditWriter.com. She has over 20 years of experience writing and speaking about credit and money, and focuses on helping families and small business owners make smart, informed decisions about their credit, money and financial products. Michelle’s work has appeared in publications such as Reader’s Digest, Parents, Experian, FICO, Forbes, Money, Bankrate, Seattle Times, MarketWatch, BuySide from Wall Street Journal, USA Today, Yahoo! Finance and more. She’s a three-time finalist for the best personal finance freelancer award from the Plutus Foundation. When she isn’t writing or speaking about credit and money, Michelle loves to travel with her family or read a good book.

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Robert Thorpe
Reviewed By
Robert Thorpe
Robert Thorpe

Robert Thorpe

Senior Editor

Robert is a senior editor at Newsweek, specializing in a range of personal finance topics, including credit cards, loans and banking. Prior to Newsweek, he worked at Bankrate as the lead editor for small business loans and as a credit cards writer and editor. He has also written and edited for CreditCards.com, The Points Guy and The Motley Fool Ascent.

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The majority of taxpayers use the standard deduction as a simple way to reduce their taxable income each year.

When you file your income tax return each year, you can either itemize deductions or choose the standard deduction to owe fewer taxes to the federal government.

IRS standard deductions for 2023 are $13,850 for single filers, $20,800 for heads of household, and $27,700 if you’re married filing jointly. Taxpayers over 65 years old may qualify for an additional deduction. But before you decide whether to select the standard deduction or itemize on your upcoming tax return, you’ll want to confirm that you’re eligible to claim the standard deduction and determine which option may save you the most money.

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Vault’s Viewpoint

  • Standard deductions for 2023 have increased compared with previous tax years.
  • Your standard deduction may vary based on your tax filing status and other factors.
  • Not everyone is eligible to claim the standard deduction.

What Is the Standard Deduction?

Congress created the standard deduction in 1944 as part of the Individual Income Tax Act. The goal of the standard deduction is to make the tax filing process easier for taxpayers.

The IRS has increased the standard deduction amount for 2023 tax returns (with a tax deadline of April 15, 2024 in most states). But the amount you can claim as a standard deduction varies based on your tax filing status.

Standard Deduction Amounts 2023

Married Filing Jointly$27,700
Qualifying Surviving Spouse$27,700
Head of Household$20,800
Single$13,850
Married Filing Separately$13,850

How Does the Standard Deduction Work?

Preparing your tax return each year can be a tedious task, especially if you itemize individual deductions. The standard deduction is a much easier way to lower the amount of income you need to pay taxes to the federal government. Instead of going through the complicated process of listing out deductions one by one, the standard deduction is a fixed dollar amount you can add to your tax return to reduce your taxable income.

For example, the median household income in the United States according to recent U.S. Census data is $74,500. If you earned the median income and filed your tax return as a single taxpayer claiming the standard deduction, your taxable income would be reduced by $13,850. So, you would only owe federal income tax on $60,650 rather than the full amount you earned.

According to the IRS, the standard deduction is popular with the majority of taxpayers. Around 90% of taxpayers claimed the standard deduction in 2021 rather than itemizing deductions on their tax returns.

Other Tax Deductions

There are a few variations to the standard deduction. In some cases, you may be able to increase the amount of the standard deduction on your tax return. Dependents, however, may face the opposite scenario.

Standard Deduction for Dependents

If another taxpayer can claim you as a dependent, it impacts the amount you can claim as a standard deduction. For the 2023 tax year, dependents may use one of the following amounts as the standard deduction on their tax return—whichever is greater.

  • $1,250
  • Earned income plus $400

As a dependent, it might make more sense for you to itemize your deductions depending on your situation. Although itemizing can make your tax return more complicated, if you’re eligible for enough tax breaks to outweigh the size of your limited standard deduction, an itemized deduction could result in either a small tax bill or a larger tax refund.

Deductions for Individuals over 65

On top of the standard deduction, taxpayers 65 and older may claim additional standard deduction amounts on their tax returns. The extra deduction you may be eligible to add to your tax return varies based on your tax filing status.

  • Single or Head of Household: $1,850
  • Married Taxpayers or Qualifying Surviving Spouse: $1,500

Deductions for the Blind

Just as individuals who are over the age of 65 can claim an additional standard deduction, taxpayers who are blind are eligible to add the same additional standard deduction amount to their tax returns. The extra deduction is based on the same tax filing status.

  • Single or Head of Household: $1,850
  • Married Taxpayers or Qualifying Surviving Spouse: $1,500

If you’re over 65 and blind, you would be eligible for a basic standard deduction plus two additional standard deduction amounts—one for age and one for blindness.

Net Qualified Disaster Loss

If you’re a victim of a federally declared disaster like a flood, hurricane, fire or earthquake, you may be able to deduct casualty and theft losses to your home, vehicles, or other property. It’s possible to claim these types of losses on your tax return alongside a standard deduction without itemizing. But if you file any claims for reimbursement from insurance providers, you’ll need to reduce the loss you claim on your taxes by the expected amount of reimbursement you expect to receive.

How to Claim the Standard Deduction

Claiming the standard deduction on your tax return is typically a simple process. You don’t have to collect or keep records of deductible expenses. But you still get the benefit of reducing your taxable income.

The way you claim the standard deduction varies based on how you’re preparing and filing your tax return.

  • Tax Software: Select standard deduction option during preparation.
  • Paper Return: Use Schedule A (Form 1040) to figure your standard deduction amount. Enter your standard deduction amount on Form 1040, line 20. (Consult with a tax professional if you have questions.)
  • Tax Professional: Inform your tax preparer that you want to take the standard deduction on your tax return.

Standard Deduction vs. Itemized Deductions

The majority of taxpayers prefer the simplicity that the standard deduction offers. But if you claim the standard deduction, you won’t be able to take advantage of many other tax write-offs that require itemizing on your tax return. As a rule, you can either opt for the standard deduction or you can itemize deductions, but you can’t choose both.

Itemizing deductions requires more effort, such as saving receipts or tracking expenses so you can prove you spent your money on tax-deductible expenses. But if you have enough write-offs to reduce your taxable income by more than the standard deduction would on its own, itemizing your deductions may be worth the extra hassle.

It may also make sense to itemize deductions if you fall into one of the following categories and are ineligible to claim the standard deduction.

  • You’re married filing separately and your spouse itemized deductions.
  • You’re filing an individual tax return for a period covering less than one year due to a change in your annual accounting period.
  • You’re filing a tax return as a trust, estate, or partnership.
  • You’re a dual-status or nonresident alien. (See IRS Publication 519 for exceptions.)

Frequently Asked Questions

What if the Standard Deduction Is More Than Your Income?

In some cases, the standard deduction could exceed the income you earn in a tax year. If this happens, you might not have to file a tax return at all. (Tip: The IRS provides an interview online that can help you figure out if you need to file a federal income tax return.) But you might still want to file a tax return even if your income falls below the IRS minimum income threshold for submitting a return. This is especially true if you qualify for refundable credits that might make you eligible for a tax refund.

What is the Standard Deduction for 2024?

The IRS has already announced the standard deduction for the 2024 tax year, even though taxpayers typically won’t file their returns until 2025. For married couples filing jointly, the standard deduction will be $29,200 in 2024. Single taxpayers and married individuals filing separately can claim a standard deduction of $14,600. Heads of household will also see an increase in the standard deduction in 2024—up to $21,900.

How Do I Maximize the Standard Deduction?

The best way to maximize your standard deduction is to make sure the information on your tax return is correct. If you’re using tax preparation software, be careful to answer each question accurately such as your marital status, age, household makeup, and whether you’re blind. Following these steps should ensure that the correct standard deduction and any additional standard deduction amounts you might be eligible for are added to your tax return.

Editorial Note: Opinions expressed here are author’s alone, not those of any bank, credit card issuer, hotel, airline or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post. We may earn a commission from partner links on Newsweek, but commissions do not affect our editors’ opinions or evaluations.

Michelle Black

Michelle Black

Contributor

Michelle is a credit expert, freelance writer and founder of CreditWriter.com. She has over 20 years of experience writing and speaking about credit and money, and focuses on helping families and small business owners make smart, informed decisions about their credit, money and financial products. Michelle’s work has appeared in publications such as Reader’s Digest, Parents, Experian, FICO, Forbes, Money, Bankrate, Seattle Times, MarketWatch, BuySide from Wall Street Journal, USA Today, Yahoo! Finance and more. She’s a three-time finalist for the best personal finance freelancer award from the Plutus Foundation. When she isn’t writing or speaking about credit and money, Michelle loves to travel with her family or read a good book.

Read more articles by Michelle Black