Question

6. When a tax payer can be eligible to receive standard deduction or itemized deductions? Is there any certain income level where a taxpayer would not be eligible for either? How about personal exemption can a taxpayer lose/[not eligible] it as well?

Answer 1

A tax payer’s eligibility to receive standard deduction depends on his/her filing status. For the year 2018 the standard deduction amount stood at $12,000 for tax filers with either single or married filing separately status. For married filing jointly the standard deduction amount is $24,000 and for head of household the amount is $18,000.

Tax payers are eligible to claim itemized deductions if they have expenses like large out of pocket medical expenses, large unreimbursed expenses as an employee, large unreimbursed miscellaneous expenses, large contribution to qualified charities etc. There are certain limitations and if a tax payer’s adjusted gross income (AGI) from Form 1040, Line 37 was more than certain amounts; some of your itemized deductions were limited. For instance in 2017 a tax payer if filing as married filing jointly the amount was $313,800. For head of household the amount was $287,650, for single taxpayer the amount was $261,500 and for married filing separately the amount was $156,900.

No, there is no certain income level where a taxpayer would not be eligible for either but a taxpayer will have to choose either the standard deduction or the itemized deduction, both cannot be selected.

In case of personal exemption since 2018 onwards IRS has suspended personal exemption and now a tax payer cannot claim a personal exemption deduction for himself, his spouse and dependents.