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How do standard tax deductions work?

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Quick Answer

The standard tax deduction is a set amount a taxpayer deducts from his income on a federal tax return without the need to itemize his deductions, according to TurboTax. For 2015, the standard deduction is $6,300 for single taxpayers and $12,600 for couples filing jointly, reports Kelly Phillips Erb for Forbes.

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Full Answer

Other filing designations are head of household and married filing separately. The amount of the standard deduction is adjusted annually due to inflation. Taxpayers can choose between taking the standard deduction or itemizing their deductions. When itemizing deductions, taxpayers can deduct expenses such as mortgage interest or charitable contributions, explains TurboTax.

When a taxpayer elects to take the standard deduction, that amount is subtracted from gross income to calculate the adjustable gross income, or the taxpayer's taxable income. Some taxpayers are not able to take the federal standard deduction, states TurboTax. If a taxpayer is married but files separately and his spouse itemizes her deductions, the taxpayer must also itemize his deductions. Taxpayers cannot claim the standard deduction if a spouse was a nonresident alien at any time during the tax year. A taxpayer also cannot take the standard deduction if he changes his annual accounting period and files a tax return that covers less than 12 months, notes the Internal Revenue Service.

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