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IRS Tax Forms > Schedule A Itemized Deductions

Schedule A - Itemized Deductions

             When you are preparing your income tax return, you have the option of claiming the standard deduction for your filing status or itemizing your deductions.  Normally, you would choose whichever method results in the larger deduction.  If you choose to itemize your deductions, you are required to file Schedule A - Itemized Deductions, and must use Form 1040.

            There are seven categories of itemized deductions.  The first category is Medical and Dental Expenses.  Certain qualified medical and dental expenses may be summed and the total entered on Schedule A.  There is a restriction on the amount you can claim for this itemized deduction.  First, you must multiply your adjusted gross income by 7.5%.  Any amount of qualified medical and dental expenses in excess of the 7.5% can be used as your itemized deduction.  There are certain items that cannot be claimed in this category, such as cosmetic surgery and over-the-counter medications.  In order to be claimed, the expense must actually have been paid by you.  The cost of medical and dental insurance premiums is deductible, but not if the payments are taken out pre-tax from your paycheck.

 

            The second category of itemized deductions on Schedule A is Taxes Paid.  This section is used to report and deduct real estate taxes, personal property taxes, and other taxes.  The taxpayer is also able to deduct either state and local income taxes or general sales taxes.  For general sales taxes, you can claim either actual sales taxes paid, or use the optional sales tax tables for the state the taxpayer lives in.

            The third category is Interest Paid.  The most common type of interest recorded here is home mortgage interest.  Normally, this amount comes from your Form 1098 which is provided by your mortgage lender.  Some taxpayers also have home mortgage interest not reported on Form 1098, points not reported on Form 1098, qualified mortgage insurance premiums, and investment interest.

            Gifts to Charity is the fourth category on Schedule A.  The charitable gifts include gifts by cash or check, and gifts other than by cash or check.  Only gifts to qualified charitable organizations are deductible, and there are limits to the amount that can be claimed.  If there is any carryover from a prior year, it is listed here.

            The fifth category of itemized deductions is Casualty and Theft Losses.  If claiming any casualty or theft losses, the taxpayer is required to attach Form 4684 to his or her income tax return.

            The sixth category on Schedule A is Job Expenses and Certain Miscellaneous Deductions.  Like Medical and Dental Expenses, only the excess over a pre-determined percentage of adjusted gross income is deductible.  In this case, only the amount over 2% of adjusted gross income is allowable.  This category includes unreimbursed employee expenses, tax preparation fees, safe deposit box fees, and more.

            The seventh and final category of itemized deductions is Other Miscellaneous Deductions.  This category includes gambling losses to the extent of gambling winnings and federal estate tax on income in respect of a decedent.

            If your adjusted gross income is above a certain threshold, your itemized deductions may be limited.           

            If you are looking for a CPA or Accounting Firm to assist you with your income tax reporting, bookkeeping, financial planning, or general accounting needs, then you have come to the right place!  Try out the CPA Search feature on this website to find a qualified professional in your area.

           

 
 
 
 
 
 
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