Itemized Deductions

Personal Finance

Itemized deductions are specific expenses the IRS allows you to subtract from taxable income, reported on Schedule A. The main categories are mortgage interest (up to $750K of loan balance), state and local taxes (SALT, capped at $10,000), property taxes (within SALT cap), charitable contributions (up to 60% of AGI for cash), medical expenses exceeding 7.5% of AGI, and casualty losses from federally declared disasters. Itemize only if your total exceeds the standard deduction. Higher-earners with large mortgages, significant charitable giving, or substantial state taxes are the typical itemizers; most W-2 employees in low-tax states take the standard.