When you start planning early, you have time on your side to help you compare between distinct
options and choose the best for yourself. While filing your tax return, you usually have a choice
of whether to itemize deductions or take the standard deduction. Before you choose, it’s a good
idea to figure your deductions using both methods. Then choose the one that allows you to pay
the lower amount of tax. The one that results in the higher deduction amount often gives you the
most benefit.

The IRS offers these tips to help you choose:

1. Figure your itemized deductions. Add up deductible expenses you paid during the year.
    These may include expenses like:

 Home mortgage interest, up to $750,000 in mortgage debt. You can NOT deduct
     interest on a mortgage that was used to pay off credit cards, student loans, or a car 
     loan.

 State and local income taxes or sales taxes (but not both), real estate and private property
     taxes, up to $10,000.

 Gifts to charities, (cash and non-cash) up to 50% of your adjusted gross income.

 Casualty or theft losses is in a Federal Declared Disaster.

 Unreimbursed medical, dental, optical expenses and health insurance.

 Unreimbursed miscellaneous Employee Expenses
     (See week 5).

2. Know your standard deduction. If you don’t itemize, your basic standard deduction depends
    on your filing status (each year the numbers change, be sure to know this year’s numbers by
    asking your tax professional).

 Single
 Married Filing Jointly
 Head of Household
 Married Filing Separately
 Qualifying Widow(er) (widows and widowers with minor children)

Your standard deduction is higher if you’re 65 or older and/or blind. If someone can claim
 you as a dependent, that can limit the amount of your standard deduction.

3. Check the exceptions. Some people don’t qualify for the standard deduction and therefore
    should itemize. This includes married couples who file separate returns when one spouse itemizes.

Call today, don’t delay! See how this affects you. We can be reached at 602-264-9331 and on all social media under azmoneyguy.

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