# Should you take the standard deduction or itemize?

> Add up your itemized deductions. If the total beats your standard deduction, itemize. If not, take the standard deduction.

Source: https://www.walletprep.com/learn/standard-deduction-vs-itemizing/ · Updated 2026-10-04 · Taxes

Take whichever deduction is bigger. For 2026, itemizing only pays off if your mortgage interest, state and local taxes, charity and large medical bills add up to more than $16,100 for a single filer or $32,200 for a married couple.

## Key facts
- **The standard deduction is set by filing status.** For 2026 it is $16,100 for single filers and married filing separately, $24,150 for head of household and $32,200 for married filing jointly. People 65 or older or blind get an extra $2,050 if unmarried or $1,650 each if married.
- **Itemizing means listing real expenses.** The main itemized deductions are state and local income or sales tax, property tax, mortgage interest, gifts to charity, medical costs above 7.5% of your income and casualty losses from a federally declared disaster. You list them on Schedule A.
- **The SALT limit is higher now.** The limit on state and local taxes rose under the new federal tax law. For 2026 it is $40,400, and it shrinks for modified adjusted gross income above $505,000, but never below $10,000.
- **The difference is worth your tax rate.** Itemizing $1,000 more than your standard deduction saves $1,000 times your top tax rate. In the 22% bracket that is $220, not $1,000.

## How to compare the two
Add up everything you could itemize for the year. Then compare it with your standard deduction. Whichever is bigger lowers your taxable income more, so it lowers your tax more. That is the whole rule.
If you are close, small items matter. A mid-year property tax payment, an extra mortgage payment in December or a large donation can push the itemized total over the line. Tax software figures both and picks the better one, but knowing your rough numbers helps you plan.

## What counts as an itemized deduction
State and local taxes, often called SALT: either your state and local income tax or your sales tax (not both), plus property tax on your home and car. Together they count up to $40,400 for 2026.
Mortgage interest on up to $750,000 of loans used to buy, build or improve your main or second home. Older loans from before December 16, 2017 have a $1 million limit. Rent does not count.
Charity: starting in 2026, only the part of your gifts above 0.5% of your adjusted gross income counts. Medical and dental costs count only above 7.5% of it. Adjusted gross income (AGI) is your total income minus a few adjustments, like student loan interest and many IRA contributions.

## Deductions you get either way
Some deductions sit outside this choice. Student loan interest, many IRA contributions, HSA contributions and half of self-employment tax come off your income whether you itemize or not.
The new federal tax law added four more for tax years through 2028: up to $25,000 of qualified tips, up to $12,500 of overtime premium pay ($25,000 for joint filers), up to $10,000 of interest on a loan for a new US-assembled car, and $6,000 for each person 65 or older. Each has income limits and its own rules, so check the IRS page before you count on one.

## Who usually comes out ahead itemizing
Itemizing tends to win for people with a large mortgage, high state income or property taxes, or big gifts to charity. A married couple needs more than $32,200 of these costs, which is a high bar without a sizable mortgage.
Renters with no large medical bills almost always do better with the standard deduction. It is also simpler: no receipts to keep and nothing to prove if the IRS asks.

## Bunching deductions
If you are just under the line each year, you can sometimes bunch: give two years of planned charity in one year and itemize, then take the standard deduction the next year. The total you give stays the same.
Bunching works best with charity because you control the timing. Check how the 0.5% floor on charitable gifts affects your numbers before you try it.

## A worked example: itemizing versus the standard deduction
Alex is single, earns $85,000 and owns a condo. This year Alex paid $10,200 in mortgage interest, $4,200 in state income tax, $3,100 in property tax and gave $1,500 in cash to charity.

- Mortgage interest: $10,200
- State income tax: $4,200
- Property tax: $3,100
- Charity above 0.5% of AGI: $1,075
- Itemized total: = $18,575
- Standard deduction: $16,100
- Cash charity, non-itemizer: $1,000
- Standard route total: = $17,100
- Tax saved by itemizing: $324.50

1. The charity floor is $85,000 × 0.5% = $425, so $1,500 − $425 = $1,075 counts. State and property taxes total $7,300, well under the SALT limit.
2. Itemizing gives $10,200 + $4,200 + $3,100 + $1,075 = $18,575. The standard route gives $16,100 plus up to $1,000 of cash gifts, or $17,100.
3. Itemizing wins by $18,575 − $17,100 = $1,475. Alex is in the 22% bracket, so it saves $1,475 × 22% = $324.50.

## Common mistakes
- **Counting the full deduction as savings.** An $18,575 deduction does not save $18,575. Only the amount above your standard deduction matters, and it saves that amount times your tax rate.
- **Adding state tax above the limit.** State and local taxes above $40,400 don't count, and the limit drops for modified AGI above $505,000. Cap the figure before you compare.
- **Itemizing without records.** If you itemize, the IRS can ask for proof. Keep Form 1098, property tax bills, charity receipts and medical bills with your return for at least three years.

## Questions people ask
### Can I take the standard deduction and still deduct mortgage interest?
No. Mortgage interest is an itemized deduction, so you only get it if you itemize. Compare your full itemized total with the standard deduction and take the larger one.

### Can I deduct charity if I don't itemize?
Yes, starting with tax year 2026. You can deduct up to $1,000 of cash gifts to qualifying charities ($2,000 if married filing jointly). Gifts of goods, stock and donations to donor-advised funds don't qualify for this.

### Is the standard deduction going up?
It is adjusted for inflation each year. For 2026 it is $16,100 for single filers, $24,150 for head of household and $32,200 for married couples filing jointly.

### Do seniors get a bigger standard deduction?
Yes. At 65 or older you add $2,050 if unmarried or $1,650 per qualifying spouse if married. On top of that, the new senior deduction of $6,000 per person applies whether you itemize or not, with an income phase-out.

## Do this today
Find last year's mortgage interest statement, property tax bill and state tax total. Add them with your charity gifts and compare the sum with your standard deduction. Write the gap down so you know where you stand.

## Sources
- [IRS Topic 501: Should I itemize?](https://www.irs.gov/taxtopics/tc501)
- [IRS: Instructions for Schedule A, Itemized Deductions](https://www.irs.gov/instructions/i1040sca)
- [IRS: Tax inflation adjustments for tax year 2026](https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill)
- [IRS Publication 505 (2026 SALT limit)](https://www.irs.gov/pub/irs-pdf/p505.pdf)
- [IRS: Working Families Tax Cuts provisions (charity deduction changes)](https://www.irs.gov/newsroom/working-families-tax-cuts)
- [IRS: Tax deductions for working Americans and seniors](https://www.irs.gov/newsroom/working-families-tax-cuts-individuals-and-workers)

_General education, not personalized financial, tax or legal advice. Figures are examples. Check current rates and limits before you act._