One of the most helpful tools in the software is the ability to compare your standard deduction and itemized deductions side by side. This allows you to see which option provides the greater tax benefit before filing your return.
In most cases, you don't need to make the decision yourself. The software automatically calculates both methods and uses the deduction that results in the lowest tax liability.
How Do I View the Comparison?
To compare your deductions, follow these steps:
- Go to Federal.
- Select Deductions.
- Choose Select my forms.
- Select View Standard vs. Itemized Deductions.
This screen displays both deduction amounts so you can see which option benefits you most.
How Does the Software Decide Which Deduction to Use?
The software automatically compares:
- Your standard deduction, and
- Your total allowable itemized deductions
Whichever deduction produces the greater tax benefit is applied to your return automatically.
For many taxpayers, the standard deduction is higher than their itemized deductions. However, taxpayers with significant expenses such as mortgage interest, property taxes, charitable contributions, or large medical expenses may benefit from itemizing.
Can I Force the Return to Use Itemized Deductions?
Yes.
Although the software automatically chooses the most beneficial deduction, you can manually force the return to use itemized deductions when necessary.
This is most commonly used for taxpayers filing Married Filing Separately (MFS).
Married Filing Separately Rules
If one spouse itemizes deductions, the other spouse generally must also itemize deductions, even if the standard deduction would be larger.
In this situation, you may need to manually force itemized deductions.
To do so:
- Go to Federal.
- Select Deductions.
- Choose Select my forms.
- Open Itemized Deductions.
- Select Choose to Itemize or Take the Standard Deduction.
- Select Force to Use Itemized Deduction.
The software will then use itemized deductions regardless of whether the standard deduction is larger.
Can I Force the Standard Deduction Instead?
No.
You cannot manually force the software to use the standard deduction.
The program automatically applies the standard deduction whenever it provides a greater tax benefit than itemizing.
If itemized deductions are being used, it's typically because they are either:
- Larger than the standard deduction, or
- Required based on your filing situation, such as certain Married Filing Separately returns.
Why Doesn't My Return Show a Standard Deduction?
You can view the deduction being used on your return by navigating to:
- Review
- Summary
- Tax and Credits
This section displays the deduction currently applied to your return and shows how it affects your taxable income calculation.
If you're itemizing, your Schedule A deductions will generally appear instead of the standard deduction.
What About the Additional Senior Deduction?
Taxpayers who qualify for the additional deduction available to certain taxpayers age 65 or older may notice that this amount doesn't appear as part of the standard deduction itself.
Instead, the additional senior deduction is displayed separately within the Tax and Credits section of the return summary.
If you're eligible, the software automatically calculates and applies the correct amount based on your age, filing status, income, and any other applicable requirements.
When Should I Review the Comparison?
It's a good idea to review the comparison if you entered:
- Mortgage interest (Form 1098)
- Property taxes
- Charitable contributions
- Medical expenses
- State income taxes or sales taxes
- Personal property taxes
These are some of the most common deductions that can make itemizing more beneficial than taking the standard deduction.