There are two main types of tax deductions: the standard deduction and itemized deductions. You can claim one type of deduction on your tax return, but not both.

For example, if you claim the standard deduction, you cannot itemize deductions – and vice versa (if you itemize deductions, you cannot claim the standard deduction). You are allowed to use whichever type of deduction results in the lowest tax.

The standard deduction is subtracted from your Adjusted Gross Income (AGI), thereby reducing your taxable income. For tax year 2016, the standard deduction amounts are as follows:

Note that there is an additional standard deduction for elderly or blind taxpayers, which is $1,250 for tax year 2016. The additional standard deduction amount increases to $1,550 if the individual is also unmarried and not a qualifying widow(er). 

State Income taxes vary from State to State contact us for information as it relates to State Income Taxes that affect you.