Each year everyone is allowed to deduct itemized deductions or deduct a standard deduction from their income, whichever is larger.
Last year, over 70% of taxpayers used the standard deduction in computing their tax. The standard deduction is a deduction for individuals who do not have much in itemized deductions. A flat amount is allowed even though the individual has not necessarily paid such amount. For 2024, the standard deduction is a whopping $29,200 for married couples ($32,300 if both 65 or over) filing a joint return.
Itemized deductions include, but are not limited to, items such common items as medical expenses (only those greater than 7 1/2% of your adjusted gross income are allowed), state, local & real estate taxes (up to $10,000 MAX), mortgage interest (can be reduced depending on mortgage amount), and qualified charitible contributions. If you incur these type expenses in 2024 but they don't add up to $29,200 ($32,300 if 65 or over), it is obviously more beneficial to claim the standard deduction instead.
The standard deduction is adjusted each year for inflation. Most people find that the standard deduction is much larger than the total of their itemized deductions. But, as your income grows, you're likely to see your itemized deductions grow also. When they become large enough, it may be more benficial to claim itemized deductions instead of the standard deduction.
