Most taxpayers claim the standard deduction when they file their federal tax return. However, some filers may be able to lower their tax bill by itemizing. Find out which way saves the most money by figuring taxes both ways.
The IRS offers the following six tips to help taxpayers decide:
1. Use IRS Free File. Most taxpayers qualify to use free, brand-name software to prepare and file their federal tax returns electronically. IRS Free File is the easiest way to file. Free File software helps taxpayers determine if they should itemize. It files the right tax forms based on the answers the taxpayer provides. Free File software does the math and allows the user to e-file the tax return – for free.
Taxpayers can check on other e-file options if they can’t use Free File.
2. Figure Your Itemized Deductions. Taxpayers need to add up deductible expenses they paid during the year. These may include expenses such as: