Core Insights - The article discusses the impact of tax deductions on taxable income and highlights the importance of choosing between standard deductions and itemizing deductions for maximizing tax benefits [1][2][3] Standard Deduction - Approximately 91% of U.S. taxpayers utilized the standard deduction in 2023, making it the most common tax break [2] - The standard deduction has nearly doubled since 2018 and now adjusts for inflation, providing significant tax relief without the need for itemization [3] - For taxpayers aged 65 and older, a new "senior bonus" deduction of up to $6,000 (or $12,000 for married couples) is available, which phases out at modified AGI levels of $75,000 for individuals and $150,000 for married couples [4] Above-the-Line Deductions - Certain deductions can be claimed even without itemizing, known as "above-the-line" deductions, which reduce gross taxable income [5] - Contributions to traditional IRAs and 401(k)s can significantly lower taxable income, with potential reductions exceeding $20,000 for high earners [6][7] - Health Savings Account (HSA) contributions offer a triple tax advantage and are expected to have expanded eligibility starting in 2026 [9][10] - Taxpayers can deduct up to $2,500 in student loan interest, but this deduction phases out for higher earners [11][12] Itemized Deductions - Itemizing deductions is beneficial primarily for those whose total itemized deductions exceed the standard deduction thresholds of $15,750 for single filers and $31,500 for married couples [13] - The state and local tax (SALT) deduction cap has increased to $40,400 for the 2025 tax year, significantly benefiting homeowners in high-tax states [16][19] - Mortgage interest deductions remain valuable, especially with the recent reinstatement of deductibility for private mortgage insurance (PMI) [20][21] - Charitable donations can be deducted if itemized, with new rules allowing standard deduction filers to deduct up to $1,000 for cash donations starting in 2026 [23][25] Medical Expenses - Medical expenses are deductible only if they exceed 7.5% of adjusted gross income, making it a challenging deduction for many [26][27]

Sit down with your CPA after October 15th when he or she's done with all the tax returns. Try to get them to do a projection for 2025 and 2026 and then see what opportunities are out there. The one big beautiful bill act has rewritten the tax landscape in ways that extend well beyond the internal revenue code.And these ripple effects are already being felt across investment decisions, retirement planning, and long-term wealth strategies. In our podcast today, my guest Bob Keebler, a partner with Keebler and ...