Standard Deduction: What You Need to Know About This Type of Deduction

The Standard Deduction is a fixed dollar amount that reduces the income you’re taxed on. It is a specific number that you can subtract from your taxable income depending on your filing status, number of dependents, and the year in which you file your tax return.

You can subtract the standard deduction amount for the reporting year from your taxable income on line 12 of tax return Form 1040.

Standard Deduction vs. Itemized Deductions

It is important to understand the difference between the two main deduction methods.

• Standard Deduction: A fixed, no-questions-asked reduction in taxable income.
• Itemized Deductions: These allow you to subtract more individual expenses, such as real estate taxes, state and local taxes (SALT), mortgage interest, and charitable contributions.

When should you itemize? Itemizing deductions is only beneficial if the total of your qualified individual expenses exceeds the standard deduction amount for your filing status.

Why Most Taxpayers Use the Standard Deduction

For the vast majority of Americans, taking the standard deduction is the preferred method for two main reasons:

1. Simplicity: The requirements for applying the standard deduction are somewhat simpler than for itemized deductions. You do not need to keep receipts for every charitable donation or medical expense. All calculations come down to subtracting the amount you are entitled to claim from your taxable income.
2. Higher Value: In the vast majority of cases, following the Tax Cuts and Jobs Act of 2017, the standard deduction amount is somewhat larger than itemizing all expenses.

What Is the Standard Deduction Amount for 2025 and 2026?

The amount of standard deduction you are entitled to depends heavily on your filing status. The deduction amount is adjusted annually for inflation. Furthermore, the passage of the One Big Beautiful Bill Act (OBBBA) has somewhat increased the standard deduction baseline for upcoming years.

There are 5 standard deductions that apply depending on your filing status:

• Single
• Married filing jointly
• Married filing separately
• Qualifying widow(er) (Surviving Spouse)
• Head of household (single but with one or more dependents)

All these statuses have different qualification rules and deduction amounts. Below are the confirmed amounts for the 2025 and 2026 tax years.

Standard Deduction Amounts Table (2025–2026)

Note: The IRS website has a convenient interactive tool to help determine exactly what standard deduction amount can be applied to your income.

When Standard Deduction Adjustments Apply

In some cases, the base standard deduction amount listed above can be adjusted higher. This applies to specific categories of taxpayers who are entitled to additional relief.

Adjustments for Age (65+) and Blindness

Taxpayers age 65 and older, as well as individuals who are officially recognized as blind, receive an additional standard deduction. This extra amount is automatically added to the base (according to the TCJA rules):

• $2,000 additional: For singles or heads of household age 65+ (or blind).
• $1,600 additional: For each married partner (i.e., $3,200 if both are 65+ or blind).
• Note: If the taxpayer is both 65+ AND blind, this additional amount is doubled.

New OBBBA Additional Benefit for Seniors (2025–2028)

In addition to the adjustments above, the new OBBBA Act introduced a significant new tax benefit for people age 65+.

This is an additional deduction available from tax years 2025–2028:

• Up to $6,000 additional deduction for individuals 65+.
• Up to $12,000 for married spouses where both are 65+.

Key features of the OBBBA senior deduction:

1. It is available regardless of whether you choose standard or itemized deductions.
2. Mandatory requirement: You must have a valid Social Security number for the taxpayer (and the spouse’s SSN if filing jointly).
3. Income Limits: This deduction is phased out for taxpayers with a modified adjusted gross income (MAGI) over $75,000 (or $150,000 for Married Filing Jointly).

Special Conditions for Spouses Filing Separately

If your status is “Married Filing Separately,” you and your spouse must coordinate. You must both apply either the standard deduction OR itemized deductions.

It is prohibited for one spouse to use the standard deduction while the other uses itemized deductions. Therefore, before completing your tax return, it is worth calculating which type of deduction will yield the better combined result.

Standard Deduction for Dependents

For taxpayers who are claimed as dependents on another person’s tax return (such as a child or elderly parent), the deduction is limited. Their deduction is generally limited to the standard deduction amount for their filing status or a calculation based on their earned income, whichever is lower.

Summary of Changes

The standard deduction remains a simple and effective way to reduce tax burden for most American taxpayers. The significantly increased standard deduction amount was initially introduced by the Tax Reform of 2017 (Tax Cuts and Jobs Act).

The Budget Reconciliation Act of 2025 (H.R. 1), also known as the One Big Beautiful Bill Act (OBBBA), makes permanent many of the changes introduced in 2017 and introduces a number of new tax rules—both short-term and long-term. In addition, under OBBBA, the standard deduction for 2025 was additionally, albeit moderately, increased to match inflation and new baselines.

How Can Gennadiy Arnautov CPA Help?

Choosing the right deduction method—standard vs. itemized—is a strategic decision that directly affects your tax bill. Don’t leave money on the table! Choosing correctly can save hundreds or even thousands of dollars annually.

Our specialists will help:

• Analyze all your expenses and determine the most beneficial option.
• Properly classify expenses for maximum tax benefit.
• Plan tax strategy for upcoming years based on new OBBBA rules.
• Ensure you don’t miss any opportunity to save.

Contact Gennadiy Arnautov CPA for professional consultation today.