Itemizing vs. the standard deduction: which is right for you?
With the standard deduction near $30,000 for joint filers, most people benefit from taking it — but a surprising number still don't realize they shouldn't be itemizing.
Before the Tax Cuts and Jobs Act of 2017, roughly one in three U.S. households itemized their deductions. After TCJA roughly doubled the standard deduction, that share dropped to about one in ten. The math changed almost overnight — and many filers (or their preparers) still operate on muscle memory from the old rules.
Here's how to think about the choice cleanly.
How the choice works
Every taxpayer can subtract a "deduction" from their adjusted gross income before calculating tax. You can either take the standard deduction — a flat amount based on your filing status — or you can itemize, which means listing specific deductible expenses on Schedule A. You take whichever is larger.
For 2025, the standard deduction is:
| Filing status | 2025 standard deduction |
|---|---|
| Single / married filing separately | $15,000 |
| Married filing jointly | $30,000 |
| Head of household | $22,500 |
Add $1,600 (married) or $2,000 (single/HoH) per person if you're 65+ or blind.
What counts as an itemized deduction
The major categories on Schedule A:
- State and local taxes (SALT) — capped at $10,000 ($5,000 if married filing separately) — this includes state income tax, property tax, and sales tax combined.
- Home mortgage interest — on up to $750,000 of debt for mortgages taken out after Dec 15, 2017 ($1 million for older mortgages).
- Charitable contributions — cash up to 60% of AGI, appreciated stock up to 30% of AGI.
- Medical expenses — the portion above 7.5% of AGI.
- Casualty and theft losses — only in federally declared disaster areas.
The break-even math
For a married couple in Texas (no state income tax) to benefit from itemizing in 2025, their Schedule A deductions need to exceed $30,000. Let's see what that looks like:
- Property tax in a typical Frisco home: ~$8,000–$12,000
- Mortgage interest on a $400,000 balance at 7%: ~$28,000 in year one
- Charitable contributions: $5,000
That household would clear the $30,000 standard deduction comfortably, but the SALT cap means only $10,000 of that property tax counts. So the actual itemized total is closer to $43,000 — still better than itemizing, by about $13,000.
Now consider the same household five years into the mortgage, when interest has dropped to $20,000:
- SALT (capped): $10,000
- Mortgage interest: $20,000
- Charitable: $5,000
- Total itemized: $35,000 vs. $30,000 standard
The benefit of itemizing has shrunk to just $5,000 — meaning maybe $1,200 in actual federal tax savings at the 24% bracket. As the mortgage amortizes further, the gap closes entirely.
Itemized vs. standard deduction across common scenarios
Joint filers in 2025. Standard deduction is $30,000. Bars above the dotted line mean itemizing wins; below means take the standard.
Three situations where itemizing usually wins
- You live in a high-tax state with high property values. New York, New Jersey, and California filers often hit the SALT cap immediately, then add mortgage interest and charitable on top.
- You had a major medical year. Out-of-pocket medical expenses above 7.5% of AGI can push you over the standard.
- You made large charitable gifts — especially appreciated stock, which is deductible at fair market value while also avoiding capital gains.
The "bunching" strategy
If your itemized deductions hover just under the standard deduction in a typical year, consider bunching — accelerating two years of charitable giving into one year. You itemize that year (taking the higher deduction), then take the standard deduction the next year. Over a two-year cycle, you've captured more total deduction than you would have by donating evenly each year.
The cleanest way to bunch is via a donor-advised fund (DAF): contribute the lump sum in your itemizing year, then distribute to charities over the following years.
The bottom line
For most middle- and upper-middle-income households without a state income tax — especially anyone past the early years of a mortgage — the standard deduction is the better choice. If you've been itemizing for years out of habit, it's worth running both calculations to be sure you're not leaving money on the table.
Need a second look at your return? Reach out — we're happy to compare both methods.
This article is general information, not personalized tax advice. Limits and rules change every year. Consult a tax professional before acting on any strategy.