About 90% of taxpayers claim the standard deduction. Since the Tax Cuts and Jobs Act nearly doubled it in 2018, taking the standard deduction has been the right call for most filers.
But “most filers” and “your situation” aren’t the same thing. If you own a business, have a mortgage, or make substantial charitable contributions, defaulting to the standard deduction could cost you thousands. And if you’re 65 or older, a brand-new $6,000 deduction starting in 2025 changes the math entirely.
Here’s what the standard deduction actually is, the current amounts for every filing status, and how to figure out whether you’re better off itemizing.
What is the standard deduction?
The standard deduction is a flat dollar amount that reduces your taxable income before tax rates apply. It’s based on your filing status. For 2025, the amounts are $15,000 (single), $30,000 (married filing jointly), and $22,500 (head of household). For 2026, they increase to $16,100, $32,200, and $24,150. Taxpayers 65 and older get an additional $1,600-$2,000 on top of those amounts, plus a new $6,000 deduction under the One Big Beautiful Bill Act (income limits apply). You either claim the standard deduction or itemize your deductions on Schedule A. You can’t do both.
Key Takeaways
- The standard deduction lowers your taxable income by a fixed amount – $15,000 for single filers and $30,000 for married filing jointly in 2025; rising to $16,100 and $32,200 in 2026
- About 90% of taxpayers use it since TCJA – but business owners with mortgage interest, state taxes, and charitable gifts may save more by itemizing
- Seniors 65+ get triple benefits from 2025 through 2028 – regular standard deduction, plus the additional senior amount, plus the new $6,000 OBBBA deduction
- The new $6,000 senior deduction phases out at higher incomes – reduction starts at $75,000 for single filers and $150,000 for joint filers
- Business deductions are completely separate – Schedule C deductions, Section 179, and QBI deductions don’t compete with the standard deduction
- Check your strategy every year – amounts change annually, and what worked last year may not be the best approach this year
Standard Deduction Amounts for 2025 and 2026
The IRS adjusts the standard deduction each year for inflation. Here are the amounts for the four most recent tax years:
| Filing Status | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|
| Single | $13,850 | $14,600 | $15,000 | $16,100 |
| Married Filing Jointly | $27,700 | $29,200 | $30,000 | $32,200 |
| Married Filing Separately | $13,850 | $14,600 | $15,000 | $16,100 |
| Head of Household | $20,800 | $21,900 | $22,500 | $24,150 |
The 2026 amounts reflect a larger-than-usual jump. That’s partly because the One Big Beautiful Bill Act made adjustments beyond the normal inflation formula.
If you’re filing your 2024 return right now (due April 15, 2025), use the 2024 column. The 2025 column applies to income you’re earning this year, and the 2026 amounts apply to income earned starting January 1, 2026.
Source: 2025 amounts from IRS Rev. Proc. 2024-40. 2026 amounts from IRS inflation adjustments for tax year 2026.
Additional Standard Deduction for Seniors (65+) and Blind Taxpayers
Taxpayers who are 65 or older, blind, or both get a higher standard deduction. This additional amount stacks on top of the base amount for your filing status.
| Situation | 2025 Additional Amount | 2026 Additional Amount |
|---|---|---|
| Single or Head of Household, age 65+ | +$2,000 | +$2,050 |
| Married (per qualifying spouse), age 65+ | +$1,600 | +$1,650 |
| Blind (single or HOH) | +$2,000 | +$2,050 |
| Blind (married, per spouse) | +$1,600 | +$1,650 |
If you qualify as both 65+ and blind, you get the additional amount twice.
Example: A single filer who’s 67 years old has a 2025 standard deduction of $15,000 + $2,000 = $17,000. A married couple filing jointly where both spouses are over 65 gets $30,000 + $1,600 + $1,600 = $33,200 for 2025.
These additional amounts are separate from the new $6,000 senior deduction covered next.
New $6,000 Senior Deduction (2025-2028)
Starting with the 2025 tax year, taxpayers 65 and older can claim an extra $6,000 deduction under the One Big Beautiful Bill Act. This is one of the biggest individual tax changes in recent years, and it works differently from the standard deduction in two ways.
It’s available whether you itemize or take the standard deduction. That’s unusual. Most deductions force you to pick one path or the other. This one doesn’t.
It’s per qualifying taxpayer. If you’re married filing jointly and both spouses are 65+, you can deduct $12,000.
Phase-Out Rules
The deduction phases out for higher earners at a 6% rate:
- Single filers: Full $6,000 if MAGI is $75,000 or less. Phases out completely at $175,000.
- Married filing jointly: Full amount if MAGI is $150,000 or less. Phases out completely at $250,000.
Example calculation: A single filer, age 68, with $100,000 in modified adjusted gross income. The excess over $75,000 is $25,000. The phase-out reduction is 6% of $25,000 = $1,500. Deduction: $6,000 – $1,500 = $4,500.
This deduction sunsets after 2028 unless Congress extends it. If you’re in or near the eligible age range, it’s worth building this into your tax planning now while it’s available.
Source: IRS: New and Enhanced Deductions for Individuals
Standard Deduction vs. Itemized Deductions
You get one or the other, not both. If your total itemizable expenses on Schedule A exceed your standard deduction, itemize. If they don’t, take the standard deduction.
Simple rule. But the hard part is knowing your actual itemizable total.
When the Standard Deduction Usually Wins
- You rent instead of own (no mortgage interest or property taxes to deduct)
- You live in a state with no income tax, like Texas, Florida, or Nevada
- Your charitable contributions are under a few thousand dollars
- You don’t have large unreimbursed medical expenses
When Itemizing Typically Saves More
- Your mortgage interest alone is close to or exceeds the standard deduction
- You have significant medical expenses above 7.5% of your adjusted gross income
- You make large charitable gifts ($10,000+)
- You pay substantial state and local income taxes (though the SALT deduction is capped at $10,000)
A Concrete Example
A married couple filing jointly with $180,000 in income:
- Mortgage interest: $18,000
- Property taxes: $12,000 (but capped at $10,000 under SALT)
- Charitable contributions: $5,000
- Total itemized deductions: $33,000
Their 2025 standard deduction is $30,000. Itemizing gives them an extra $3,000 in deductions. At the 22% tax bracket, that’s roughly $660 in tax savings from itemizing instead.
Not life-changing, but not nothing either. And that gap can grow or shrink each year as your circumstances change. This is why we tell clients to run both calculations annually rather than assuming last year’s approach still works.
For home office deductions and other small business tax deductions, keep reading. Business deductions work differently.
Standard Deduction Rules for Dependents
If someone else can claim you as a dependent, your standard deduction is limited.
For 2025, the standard deduction for a dependent is the greater of:
- $1,350, or
- Your earned income plus $450
Either way, it can’t exceed the normal standard deduction for your filing status ($15,000 for single in 2025).
Typical scenario: A college student working part-time earns $6,000 and is claimed as a dependent on their parents’ return. Their standard deduction is $6,000 + $450 = $6,450.
Most SDO clients are business owners, not dependents. But if you have kids with part-time jobs, this is how their tax situation works.
Business Deductions Are Separate from the Standard Deduction
This is the single most misunderstood thing about the standard deduction, and we hear it constantly: “I take the standard deduction, so I can’t deduct my business expenses.”
That’s wrong.
The standard deduction replaces personal itemized deductions on Schedule A (things like mortgage interest, charitable giving, and state taxes). It has nothing to do with business deductions.
If you’re a sole proprietor, your Schedule C deductions happen on a completely different part of your return. Same with Section 179 depreciation, the qualified business income (QBI) deduction, and the deduction for half of your self-employment tax. All of those are “above the line” deductions that reduce your adjusted gross income before you ever choose between standard and itemized.
The order of operations:
- Calculate your gross income
- Subtract above-the-line deductions (business expenses, SE tax deduction, QBI, retirement contributions)
- That gives you adjusted gross income (AGI)
- THEN choose: standard deduction or itemized deductions
- The result is your taxable income
S-Corp and partnership owners work slightly differently because business income flows through on Schedule K-1, but the principle is the same. Your entity-level deductions are separate from the standard vs. itemized choice.
How the Standard Deduction Has Changed Over Time
The standard deduction has increased significantly since 2017. The Tax Cuts and Jobs Act (TCJA) nearly doubled it starting in 2018, which is why itemizing became less common overnight.
Before TCJA, the standard deduction for a single filer was $6,350 (2017). By 2025, it’s $15,000. For married filing jointly, it went from $12,700 to $30,000 in the same period.
The TCJA provisions were originally set to expire after 2025. The One Big Beautiful Bill Act extended them and added new provisions, including the $6,000 senior deduction. The current framework runs through at least 2028, though some provisions have different sunset dates.
The IRS announces next year’s amounts each October as part of its annual inflation adjustments. We’ll update this article when the 2027 amounts are released.
Frequently Asked Questions
Does the standard deduction reduce my taxable income or my tax bill?
It reduces your taxable income, not your tax bill directly. A $15,000 standard deduction doesn’t save you $15,000 in taxes. If you’re in the 22% bracket, a $15,000 standard deduction reduces your taxes by roughly $3,300. Tax credits, by contrast, reduce your tax bill dollar-for-dollar.
Can I take the standard deduction and still deduct business expenses?
Yes. Business deductions on Schedule C, Section 179, and the QBI deduction are all separate from the standard vs. itemized choice. You can take the standard deduction and deduct every legitimate business expense. See the “Business Deductions Are Separate” section above.
What is the standard deduction for someone over 65?
For 2025, a single filer over 65 gets a base standard deduction of $15,000 plus an additional $2,000, for a total of $17,000. They may also qualify for the new $6,000 senior deduction (income limits apply), bringing the potential total to $23,000. A married couple filing jointly where both are 65+ gets up to $33,200 in standard deduction plus up to $12,000 in the new senior deduction.
Should I itemize or take the standard deduction?
Add up your Schedule A expenses: mortgage interest, state and local taxes (up to $10,000), charitable contributions, and medical expenses exceeding 7.5% of AGI. If that total exceeds your standard deduction, itemize. If it’s lower, take the standard deduction. Run this comparison every year since both your expenses and the standard deduction amounts change.
Does the standard deduction change every year?
Yes. The IRS adjusts it annually for inflation, typically announcing the next year’s amounts each October. The amounts have increased every year since TCJA took effect in 2018.
Can married filing separately take the standard deduction?
Yes, but there’s a catch. If one spouse itemizes, the other must also itemize. You can’t have one spouse take the standard deduction while the other itemizes. Both must use the same method.
Plan Your Deduction Strategy
Most taxpayers can safely take the standard deduction and move on. But if you own a business, have significant personal deductions, or are approaching 65, the standard approach may not be the best one. The difference between running both calculations and just defaulting can be worth hundreds or thousands of dollars.
At SDO CPA, we analyze both scenarios as part of our year-round tax planning services. If you’d like us to look at your specific situation, request an upfront estimate.
This article reflects tax law as of February 2026, including the One Big Beautiful Bill Act provisions. Standard deduction amounts are updated annually when the IRS releases new figures. Consult a tax professional for advice specific to your situation.