Tax season is finally here for people in the United States, but you might be wondering when you fill out your tax return whether you should take the standard deduction or itemize deductions.
The large majority of taxpayers opt for the standard deduction, which is a fixed figure that the IRS announces on an annual basis, so as you can imagine there are slight tweaks depending on the situation at the time.
Standard deduction meaning
For anyone who does not fully understand what the standard deduction is, it is a way of bringing down your taxable income on your tax return. Most people opt for this as it saves you having to do the old process of saving receipts and tracking expenses, with the standard deduction being a flat dollar amount which is set by the IRS.
What is the standard deduction for 2022?
There are a series of factors that come into play when trying to find out how much the standard deduction is worth, particularly in relation to last year – 2021 – and this year.
These factors include your filing status, your age, whether you are blind, and whether another taxpayer is able to claim you as a dependent.
In the last few weeks the IRS has announced the new tax brackets and standard deduction amounts for the 2022 tax year – ahead of your tax return in 2023 – and there is a slight increase across the board compared to 2021.
The standard deduction in 2021 was $12,550 for anyone who is single or married but filing separately; $25,100 for anyone who is married and filing jointly, as well as for surviving spouses; and it is $18,800 for the head of household.
Compare that to 2022 and you will see that there is a minor rise, as the standard deduction in 2022 is $12,950 for anyone who is single or married but filing separately; $25,900 for anyone who is married and filing jointly, as well as for surviving spouses; and it is $19,400 for the head of household.