Standard Deduction
The standard deduction is a dollar amount that reduces the amount of income on which you are taxed and varies according to your filing status; there is also an additional standard deduction for individuals who are blind or age 65 or over.
The new tax law nearly doubled the standard deduction amounts to $12,000 for single filers, $24,000 for joint filers, and $18,000 head of household filers for tax years 2018 through 2025. The new law didn’t change the additional amounts for the blind and elderly. These amounts are adjusted annually for inflation.
For tax year 2017, the standard deduction amounts were the following for each filing status:
- Single or Married Filing Separately: $6,350
- Married Filing Jointly or Qualifying Widow(er): $12,700
- Head of Household: $9,350
An additional $1,250 or $1,550 (for Single or Head of Household) was available if the taxpayer or spouse was elderly (born before January 2, 1953) or blind. The taxpayer can take multiple additional amounts – each taxpayer or spouse could qualify for up to two additional amounts).
For tax years 2018 through 2025, the standard deduction amounts are the following:
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Single or Married Filing Separately: $12,000 |
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Married Filing Jointly or Qualifying Widow(er): $24,000 |
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Head of Household: $18,000 |
The same additional amounts apply for the blind and elderly ($1,300 or $1,600 for Single or Head of Household)
The above amounts are adjusted annually for inflation.
How will this affect me?
In tax year 2017, Ethan and Mia filed a joint tax return and claimed a total of $20,000 in itemized deductions on Schedule A. They expect to have even less itemized deductions in 2018 due to the new limitation on state taxes. They would benefit from taking a standard deduction of $24,000 on their tax year 2018 tax return. Neither qualify for the additional amounts for the blind and elderly.
Same as above, but both Ethan and Mia are blind and both were born in 1950. They would both qualify for two additional amounts. Therefore, their 2018 standard deduction amount would increase by $5,200 (four additional amounts of $1,300) to a total of $29,200.