Standard Deduction vs Itemizing: Most People Get the Math Wrong

A meaningful number of people who itemize their deductions would get more money from the standard deduction. And plenty of people taking the standard deduction are leaving money behind because they don't realize their deductible expenses exceed the threshold. Both mistakes are common, both are avoidable, and neither requires a tax professional to fix.

The decision comes down to a single comparison. If your total itemizable deductions are higher than the standard deduction, itemize. If they're not, take the standard. Everything else is detail.

What the Standard Deduction Is

The standard deduction is a flat amount the IRS lets you subtract from your adjusted gross income without having to document specific expenses. For 2024 taxes (filed in 2025), it's $14,600 for single filers and $29,200 for married couples filing jointly.

The 2017 tax law nearly doubled the standard deduction and eliminated or capped several popular itemized deductions. The result is that roughly 90% of taxpayers now take the standard deduction — up from about 70% before 2017. For most people, itemizing no longer makes sense simply because the standard deduction is large enough to beat the sum of their itemizable expenses.

Extra amounts are added for age and disability: people over 65 or who are blind get an additional $1,950 (single) or $1,550 per qualifying person (married). These stack.

What You Can Actually Itemize

The main categories of itemizable deductions are: state and local taxes (capped at $10,000), mortgage interest on your primary residence and one secondary residence, charitable contributions, medical expenses above 7.5% of AGI, and casualty and theft losses in federally declared disaster areas.

Several things that used to be itemizable no longer are. Employee business expenses — unreimbursed work costs, home office for employees, moving expenses — were eliminated for most taxpayers by the 2017 law. Tax preparation fees and investment advisory fees were also eliminated. These are gone until Congress changes the rules again.

The Calculation That Actually Settles This

Add up your potential itemizable deductions for the year:

State income tax (or sales tax) paid + property taxes paid — combined, capped at $10,000.

Mortgage interest paid — found on Form 1098 from your lender.

Charitable donations — cash, and fair market value of non-cash donations with documentation.

Medical expenses above 7.5% of your AGI — only the amount over the threshold counts.

If that total exceeds your standard deduction, itemizing saves you more. If it doesn't, take the standard deduction and be done with it.

For a single filer with $8,500 in mortgage interest, $7,000 in state and local taxes (capped at the SALT limit anyway), and $2,000 in charitable donations: that's $17,500 in potential itemized deductions versus a $14,600 standard deduction. Itemizing saves more — but only by $2,900, which at a 22% tax rate is about $638. Worth doing. Not life-changing.

When Itemizing Clearly Wins

High-cost homeowners in high-tax states are the people itemizing still makes obvious sense for. If you have a large mortgage with substantial interest, pay significant property taxes, live in a state with a 7% to 13% income tax rate, and make meaningful charitable donations, your itemized total can easily hit $25,000 to $40,000 — well above the standard deduction for both singles and married filers.

Major medical years are another scenario where the math shifts. If you had $60,000 in medical expenses in a year where your AGI was $80,000, the deductible amount is $60,000 minus 7.5% of $80,000 ($6,000) = $54,000. Add that to other deductions and you're well past any standard deduction threshold.

The Bunching Strategy for Charitable Givers

If you're close to the itemization threshold — say your standard deduction is $14,600 and your normal itemized expenses run about $12,000 — bunching is worth considering.

Bunching means concentrating two years of charitable donations into one year instead of spreading them evenly. If you normally give $3,000 per year to charity, give $6,000 in year one and $0 in year two. In year one, your itemized total reaches $15,000 — above the standard deduction. You itemize and save extra. In year two, you take the standard deduction.

A donor-advised fund (DAF) makes this cleaner. You contribute two years of donations to a DAF in year one, get the full deduction immediately, and then distribute the grants to your chosen charities over the following two years on whatever timeline you want. The charities get the same donation spread over time; you get the tax benefit all at once.

You Can't Do Both, and That's the Point

This is a binary choice every year — standard or itemized, not a mix. The standard deduction is the floor. If your itemizable expenses beat it, you replace the standard deduction with your actual expenses. If they don't, the IRS gives you the standard amount by default.

Some people assume they should always itemize because they own a home. That used to be closer to true before 2017 doubled the standard deduction. Now, especially for people who bought recently when rates were higher (meaning more interest, which sounds like more deduction, but the actual interest amount in the first few years is still limited by the loan size), it's worth running the numbers rather than assuming.

The calculation you need to run takes less than ten minutes. Pull your property tax bill, your mortgage interest statement, your charitable donation records, and your state income tax total. Add them up. Compare to the standard deduction. That's it.

Run the numbers once a year. That's the whole strategy.