Page 94 - 2020 Publication 17

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Part Three. Fileid: … ations/P17/2020/A/XML/Cycle03/source 14:38 - 19-Jan-2021

Standard After you have figured your adjusted gross income, you are ready to
subtract the deductions used to figure taxable income. You can subtract
Deduction, either the standard deduction or itemized deductions, and, if you qualify,
the qualified business income deduction. Itemized deductions are
Itemized deductions for certain expenses that are listed on Schedule A (Form 1040).
The three chapters in this part discuss the standard deduction and each
Deductions, and itemized deduction. See chapter 10 for the factors to consider when
deciding whether to take the standard deduction or itemized deductions.
Other The Form 1040 and 1040-SR schedules that are discussed in these
chapters are:
Deductions • Schedule 1, Additional Income and Adjustments to Income;

• Schedule 2 (Part II), Other Taxes; and
• Schedule 3 (Part I), Nonrefundable Credits.

Schedule A (Form 1040). The standard deduc- 530 530 Tax Information for Homeowners
tion is higher for taxpayers who:
10. • Are 65 or older, or 547 547 Casualties, Disasters, and Thefts
• Are blind. 550 550 Investment Income and Expenses
970 970 Tax Benefits for Education
Standard You benefit from the standard deduc- 936 936 Home Mortgage Interest Deduction

Deduction TIP tion if your standard deduction is more Form (and Instructions)
than the total of your allowable item-
ized deductions. Schedule A (Form 1040) Schedule A (Form 1040) Itemized
Deductions
What's New Persons not eligible for the standard de-
duction. Your standard deduction is zero and
you should itemize any deductions you have if: Standard Deduction
Standard deduction increased. The stand- • Your filing status is married filing sepa- Amount
ard deduction for taxpayers who don't itemize rately, and your spouse itemizes deduc-
their deductions on Schedule A (Form 1040) tions on their return; The standard deduction amount depends on
has increased. The amount of your standard your filing status, whether you are 65 or older or
deduction depends on your filing status and • You are filing a tax return for a short tax blind, and whether another taxpayer can claim
other factors. Use the 2020 Standard Deduction year because of a change in your annual you as a dependent. Generally, the standard
accounting period; or
Tables near the end of this chapter to figure deduction amounts are adjusted each year for
your standard deduction. • You are a nonresident or dual-status alien
during the year. You are considered a inflation. The standard deduction amounts for
In 2020, you are allowed a charitable dual-status alien if you were both a nonres- most people are shown in Table 10-1.
TIP contribution deduction of up to $300 if ident and resident alien during the year. Decedent's final return. The standard deduc-
you don't itemize your deductions. For tion for a decedent's final tax return is the same
more information, see Line 10b in the Instruc- If you are a nonresident alien who is married as it would have been had the decedent contin-
tions for Forms 1040 and 1040-SR. to a U.S. citizen or resident alien at the end of ued to live. However, if the decedent wasn't 65
the year, you can choose to be treated as a
U.S. resident. (See Pub. 519.) If you make this or older at the time of death, the higher stand-
ard deduction for age can't be claimed.
Introduction choice, you can take the standard deduction.
If you can be claimed as a dependent
This chapter discusses the following topics. ! on another person’s return (such as Higher Standard
your parents’ return), your standard de- Deduction
• How to figure the amount of your standard duction may be limited. See Standard Deduc-
CAUTION
deduction. tion for Dependents, later. for Age (65 or Older)
• The standard deduction for dependents. If you are age 65 or older on the last day of the
• Who should itemize deductions. Useful Items year and don't itemize deductions, you are enti-
Most taxpayers have a choice of either tak- You may want to see: tled to a higher standard deduction. You are
ing a standard deduction or itemizing their de- considered 65 on the day before your 65th
ductions. If you have a choice, you can use the Publication birthday. Therefore, you can take a higher
method that gives you the lower tax. standard deduction for 2020 if you were born
The standard deduction is a dollar amount 501 501 Dependents, Standard Deduction, before January 2, 1956.
that reduces your taxable income. It is a benefit and Filing Information Use Table 10-2 to figure the standard de-
that eliminates the need for many taxpayers to duction amount.
itemize actual deductions, such as medical ex- 502 502 Medical and Dental Expenses Death of a taxpayer. If you are preparing a re-
penses, charitable contributions, and taxes, on 526 526 Charitable Contributions turn for someone who died in 2020, read this

Page 90 Chapter 10 Standard Deduction