When it comes to filing your tax return, there are two different deductions you can do. The “Standard” deduction, or “Itemized” deductions. What is the difference?
Standard Deduction is a pre-determined dollar amount based on your filing status.
Itemized Deductions are certain personal expenses that can be claimed as deductions because they burdened the taxpayer just for having these expenses. (example: medical expenses)
Normally, the best thing to do is go with whichever lowers your tax liability the most. For example the standard deduction for a “single” taxpayer is $12,400 (2040 tax year), however, if that person has itemized deductions above that amount then it is in their best interest to use itemized deductions rather than the standard deduction.
These deductions lower your adjusted gross income, which in turn, lowers the amount you can be taxed on your income, which is why you are always going to want to go with whichever one betters your tax situation.