Itemized Deduction

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Definition of 'Itemized Deduction'

An itemized deduction is a type of tax deduction that allows you to subtract certain expenses from your taxable income. Itemized deductions are claimed on Schedule A of Form 1040.

There are many different types of itemized deductions, including:

* Medical expenses
* Taxes
* Interest
* Charitable contributions
* Casualty and theft losses
* Unreimbursed employee expenses
* Investment expenses
* Moving expenses
* Qualified education expenses

To claim an itemized deduction, you must itemize your deductions on Schedule A of Form 1040. You can only claim itemized deductions if your total itemized deductions are more than the standard deduction for your filing status.

The standard deduction is a set amount that you can claim regardless of your actual expenses. The standard deduction is different for each filing status. For 2023, the standard deduction is as follows:

* Single: $12,950
* Married filing jointly: $25,900
* Head of household: $19,400
* Married filing separately: $12,950

If your total itemized deductions are less than the standard deduction for your filing status, you will not be able to claim any itemized deductions. You will instead claim the standard deduction.

There are a few things to keep in mind when claiming itemized deductions. First, you must have receipts for all of your eligible expenses. Second, you must itemize your deductions on Schedule A of Form 1040. Third, you must meet all of the requirements for each type of deduction that you claim.

If you are not sure whether you should itemize your deductions, you can use the IRS's Tax Withholding Estimator to help you decide. The Tax Withholding Estimator will compare your itemized deductions to the standard deduction and tell you which option is more beneficial for you.

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