Common Tax Deductions You Can Claim

A tax deduction reduces the income the IRS counts when calculating what you owe. The most common deductions fall into two categories: the standard deduction (a flat amount based on your filing status) or itemized deductions (specific expenses you list). Most people use the standard deduction because it is simpler, but if your expenses add up to more than the standard amount, itemizing saves you money.

The standard deduction for 2024 is $14,600 for single filers, $29,200 for married filing jointly, and $21,900 for head of household. These amounts change yearly. If you itemize instead, you can deduct mortgage interest, state and local taxes (capped at $10,000), charitable donations, and medical expenses above 7.5% of your income.

Key Takeaways

  • The standard deduction is a flat amount you subtract from your income; most filers use this rather than itemizing.
  • If you own a home, you can deduct mortgage interest and property taxes, but state and local taxes combined cannot exceed $10,000.
  • Self-employed people can deduct business expenses like office supplies, equipment, and a portion of health insurance premiums.
  • Medical and dental expenses above 7.5% of your adjusted gross income, charitable donations, and student loan interest are also deductible.
  • Keeping receipts and records is essential; the IRS can ask you to prove any deduction you claim.

Deductions for Homeowners and Renters

If you own a home, mortgage interest is deductible on loans up to $750,000 (or $1 million if you took out the mortgage before December 16, 2017). You can also deduct property taxes, but here is the catch: your state and local taxes combined—including income tax or sales tax—cannot exceed $10,000 per year. This cap applies whether you own or rent.

Renters cannot deduct rent itself, but you may be able to deduct state and local taxes if you paid them. Some states also offer a renter tax credit, which works differently from a deduction; check your state's tax authority website to see if you may have access to.

Home improvements that add value—a new roof, kitchen renovation, or energy-efficient windows—are not deductible in the year you make them. However, if the improvement is also a medical necessity (a wheelchair ramp, for example), the cost above the home's increased value may be deductible as a medical expense.

Business and Self-Employment Deductions

If you are self-employed or run a small business, you can deduct ordinary and necessary business expenses. This includes office supplies, equipment under $2,500, software subscriptions, internet and phone bills (the business portion only), vehicle mileage at the IRS rate (67.5 cents per mile for 2024), and rent or utilities for a dedicated home office.

You can also deduct a portion of your health insurance premiums, half of your self-employment tax, and contributions to a retirement plan like a SEP-IRA or Solo 401(k). Keep detailed records of all expenses and mileage; the IRS asks for proof more often for self-employed filers than W-2 employees.

Home office deductions come in two forms: the simplified method ($5 per square foot, up to 300 square feet) or actual expenses (utilities, rent, insurance, repairs). The simplified method is easier if your office is small; actual expenses save more money if you have a large dedicated space.

Medical, Dental, and Education Expenses

Medical and dental expenses are deductible, but only the amount above 7.5% of your adjusted gross income (AGI). If your AGI is $60,000, you can only deduct medical costs above $4,500. This high threshold means most people do not benefit unless they had major surgery, ongoing treatment, or significant dental work in the same year.

Deductible medical expenses include doctor and dentist visits, prescription medications, medical equipment, and health insurance premiums (for self-employed people and those on COBRA). Cosmetic surgery is not deductible unless it is medically necessary.

Student loan interest is deductible up to $2,500 per year if you paid interest on a federal or private student loan and your income is below the phase-out range ($75,000 to $90,000 for single filers in 2024). Tuition and education expenses may also be deductible through the American Opportunity Tax Credit or Lifetime Learning Credit, though these work differently than deductions.

Charitable Donations and Contributions

Donations to may have access to charities—nonprofits, religious organizations, and public schools—are deductible. You can donate money, clothing, household items, or vehicles. Keep receipts for cash donations and written acknowledgment from the charity for donations over $250.

For non-cash donations like used clothing or furniture, you must estimate the fair market value (what someone would pay for the item used, not what you paid for it new). The IRS publishes a guide called the Charitable Contributions Publication 526 with valuation tables. If you donate a vehicle, the deduction is typically the sale price if the charity sells it, not what you paid.

Donations to political campaigns, candidates, or parties are not deductible. Neither are donations to individuals, even if they are in need. The charity must be registered with the IRS; you can search the Tax Exempt Organization Search tool on the IRS website to confirm.

Other Common Deductions

Several smaller deductions explore to specific situations. If you paid state or local income tax, sales tax, or property tax, these count toward your $10,000 state and local tax cap. If you are an educator, you can deduct up to $300 in classroom supplies. Military members can deduct uniform costs and reservist travel expenses.

If you had investment losses, you can deduct up to $3,000 against other income in a single year; excess losses carry forward to future years. Gambling losses are deductible, but only up to gambling winnings (and you must itemize to claim them).

Alimony paid is deductible if the divorce or separation agreement was finalized before January 1, 2019. Alimony received is taxable income. Child support is neither deductible nor taxable.

Standard Deduction Versus Itemizing

You choose one: take the standard deduction or itemize. If you itemize, add up all your deductible expenses. If the total exceeds the standard deduction for your filing status, itemizing saves you money. If it does not, use the standard deduction.

Most people benefit from the standard deduction because it is higher than their actual expenses. You should itemize only if you have significant mortgage interest, property taxes, charitable donations, or medical expenses. Use a tax software calculator or worksheet to compare both options before you file.

Once you choose, you cannot switch methods on the same return. If you file jointly with a spouse, you both must use the same method—you cannot itemize while your spouse takes the standard deduction.

Keeping Records and Avoiding Mistakes

The IRS can audit your return up to three years after you file (or longer if you underreported income by 25% or more). Keep receipts, invoices, bank statements, and written documentation for every deduction you claim. For charitable donations, keep the receipt from the charity or a bank record showing the transfer. For medical expenses, keep bills and insurance statements.

Common mistakes include claiming deductions you are not may have access to to, inflating the value of non-cash donations, or deducting personal expenses as business expenses. If you work from home, you cannot deduct your entire mortgage or rent—only the portion of your home used exclusively for business. If you use your car for both personal and business driving, you can only deduct the business miles.

If you are unsure whether an expense is deductible, check IRS Publication 17 (Your Federal Income Tax) or Publication 334 (Tax Guide for Small Business). These are free and available on the IRS website. When in doubt, do not claim it; an incorrect deduction can trigger an audit and penalties.

Frequently Asked Questions

Can I deduct my car payment or insurance?

Car payments are not deductible. Car insurance is deductible only if the vehicle is used for business. If you drive for work, you can deduct either the actual expenses (insurance, gas, repairs, depreciation) or use the standard mileage rate, which is simpler for most people.

What if I made a mistake on my deductions last year?

You can file an amended return using Form 1040-X within three years of the original filing date. If you claimed a deduction you should not have, amending corrects it and may reduce any penalties owed. The IRS processes amended returns slowly, so allow several months.

Are life insurance premiums deductible?

No, life insurance premiums are not deductible for personal policies. If you are self-employed and pay premiums for employees as part of a group plan, those are deductible as a business expense, but your own premiums are not.

Can I deduct my gym membership or fitness expenses?

No, general fitness and gym memberships are not deductible. However, if a doctor prescribed a specific treatment or exercise program for a medical condition, the cost may be deductible as a medical expense if it exceeds 7.5% of your AGI.

Do I need to itemize if I have a mortgage?

Not necessarily. Even with mortgage interest, you should only itemize if your total deductions (mortgage interest plus property taxes, charitable donations, and medical expenses) exceed the standard deduction. Many homeowners still benefit more from the standard deduction.