Deductions reduce your taxable income before your tax rate is applied — some are available no matter how you file, others only if you itemize. Here are the ones worth knowing about.
Above-the-line deductions (available even if you take the standard deduction)
| Deduction | Notes |
|---|---|
| Traditional IRA contributions | Deductible up to annual limits, subject to income phase-outs if you or your spouse have a workplace retirement plan |
| HSA contributions | Fully deductible, if you have an eligible high-deductible health plan |
| Student loan interest | Up to $2,500/year, subject to income phase-outs |
| Half of Self-Employment Tax | Automatic for self-employed filers |
| Educator expenses | Up to $300 for eligible teachers buying classroom supplies |
Itemized deductions (only if you don't take the standard deduction)
| Deduction | Notes |
|---|---|
| Mortgage interest | On acquisition debt up to $750,000 |
| State and local taxes (SALT) | Capped at $10,000 combined |
| Charitable donations | Cash and non-cash, with documentation requirements above certain thresholds |
| Medical expenses | Only the portion exceeding 7.5% of your AGI |
See our Standard vs Itemized Deduction guide to figure out which approach saves you more.
Commonly missed deductions
- State tax paid with last year's return — if you itemize and owed state tax when filing last year, that payment is deductible this year (subject to the SALT cap)
- Job search costs for a role in your current field aren't federally deductible under current law — a common point of confusion, since they used to be
- Home office deduction for self-employed individuals with a dedicated workspace
See how your deductions change your final tax bill.
Use the Federal Income Tax Calculator →
GENERAL GUIDANCE
Deduction eligibility and limits are set annually and have specific documentation requirements. Keep records and verify your specific situation with a CPA or the IRS.