What Are Itemized Deductions? Full Guide to Maximizing Your Tax Break

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Itemized deductions are specific expenses you can subtract from your taxable income to potentially lower your tax bill. In some cases, they can save you more than the standard deduction, especially if you have big-ticket write-offs like mortgage interest or large charitable donations.

This guide walks you through everything you need to know to break down what are itemized deductions, how to take advantage of them and what qualifies under current tax law.

What Are Itemized Deductions?

Itemized deductions are expenses the IRS allows you to subtract from your gross income to reduce your taxable income.

These deductions can include things like medical expenses, mortgage interest and state taxes you’ve paid.

Itemized Deductions vs. Standard Deductions

When filing your taxes, one of the biggest decisions you’ll make is whether to take the standard deduction or itemize your deductions. The standard deduction is a fixed amount that reduces your taxable income, while itemized deductions are specific eligible expenses, like mortgage interest or medical costs, that you list individually to potentially lower your tax bill more than the standard amount.

The right choice can have a significant impact on how much tax you owe — or how much you get back.

2025 Standard Deduction Amounts

The IRS adjusts standard deduction amounts annually to account for inflation. Here’s what they look like for the 2025 tax year:

Should You Itemize Your Deductions or Take the Standard Amount?

If your qualifying expenses add up to more than the standard deduction for your filing status, it may be worth the extra effort to itemize.

Common Expenses That Justify Itemizing:

• Mortgage interest
• State and local taxes (SALT) limited to $10,000
• Charitable contributions
• Medical expenses that exceed 7.5% of your adjusted gross income (AGI)

Looking Ahead: 2026 and Beyond

The Tax Cuts and Jobs Act of 2017 significantly increased the standard deduction, which reduced the number of people who itemize. But that provision is set to expire after the 2025 tax year.

If no new legislation is passed, standard deduction amounts will drop back to pre-2018 levels, which could make itemizing more beneficial for many taxpayers starting in 2026.

How To Calculate Your Itemized Deductions

To calculate your deductions, you’ll need to use Schedule A (Form 1040) and list each qualified expense.

Using Schedule A

Schedule A organizes itemized deductions into categories. You simply enter your qualified expenses in each section and total them up at the end.

Example: Medical Expenses and AGI Limits

You can only deduct unreimbursed medical expenses that exceed 7.5% of your adjusted gross income (AGI). For example, if your AGI is $60,000, you can only deduct the portion of medical costs over $4,500.

Common Itemized Deductions

Here’s a breakdown of popular itemized deductions many taxpayers can claim:

Lesser-Known Itemized Deductions

Some deductions fly under the radar, but they still count:

• Charitable mileage: You can deduct 14 cents per mile driven for charity
• Jury duty pay: If you turned over pay to your employer, you can deduct that amount
• Mortgage refinance points: Spread out the deduction over the loan term
• Military moving expenses: Deductible for active-duty members under orders

Who Is Required To Itemize?

You must itemize if:

• You’re married filing separately and your spouse itemizes
• You’re a nonresident or dual-status alien
• You want to deduct certain types of expenses that aren’t allowed with the standard deduction

Standard Deduction Amounts (2024 & 2025)

Here are the current standard deduction amounts:

Should You Itemize or Take the Standard Deduction?

If you’re unsure whether to itemize or stick with the standard deduction, here’s a side-by-side look at the pros and cons of each approach:

Final Take: Maximize Your Tax Savings

Now that you know what are itemized deductions, the key is to compare them with your standard deduction. If your eligible expenses add up to more than the standard amount, itemizing could save you hundreds — or even thousands — on your tax bill.

Take the time to review your financial records, use Schedule A and consider working with a tax pro if your situation is complex.

Want more help? Check out our guides on tax deductions vs. tax credits and 2025 federal tax brackets.

Jacob Wade contributed to the reporting of this article.

Information is accurate as of June 5, 2025.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

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