If you have a $300,000 mortgage at 4% interest, that’s already $12,000 of interest you can deduct. If you owned a home and your mortgage interest, points, and mortgage insurance premiums exceed your standard deduction, there's a good chance you would benefit from itemizing, Intuit TurboTax said.Hints as to whether you may benefit from itemizing, without doing detailed calculations, could lie in whether you owned a home, had significant medical expenses, or made sizable donations. The IRS says you should itemize deductions if their total tops your standard deduction, or if you must itemize deductions because you can't use the standard deduction. It’s unknown how many of those people could have fared better itemizing their deductions, but it is likely “some of those who took the easy way out probably shortchanged themselves,” according to Intuit TurboTax.Īre you ready for tax season? Everything you need to know to file in 2023. In the tax year 2020, 87.3% of Americans took the standard deduction, just shy of the 87.6% who did in 2019, IRS data shows. But sometimes a little extra effort to itemize deductions could be worth it to lower your tax bill or boost your refund.ĭeductions reduce the amount of your taxable income. So generally, the more you have, the lower your taxes.Ī standard deduction reduces your taxable income by a set amount, depending on your income, age, filing status and other factors, whereas with itemized deductions, you can pick and choose from among hundreds if you qualify. When it comes to taxes, it’s much easier to take the standard deduction and get your return done quickly.
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