Tax Tip: Take the Standard Deduction or Itemize?

By ABC News

Feb 21, 2014 6:01am
GTY tax form kab 140220 16x9 608 Tax Tip: Take the Standard Deduction or Itemize?

(Credit: Jeffrey Hamilton/Getty Images)

The Internal Revenue Service allows a married couple, filing jointly, $12,200 as a standard deduction for their 2013 tax return.  But is that the best option for you and your spouse?

Kevin McCormally, editorial director for Kiplinger Personal Finance, says taking the standard deduction makes sense for many.

“I think most people who claim the standard deduction are doing the right thing. It gives them more benefit than if they itemize, and it’s certainly simpler,” he tells ABC News Radio.

But if you’re paying a lot of mortgage interest, health costs, or some other deductible items, tax accountant Janice Hayman says it might be best to itemize.

“You should absolutely see if you can. I think if people took the time to collect certain receipts from charities for goods donated, those alone are something that could get you over the edge and allow you to itemize,” she says.

Many tax preparation programs allow you to try both methods to see which yields the lowest tax bill.

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