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amount allowed to an individual taxpayer who does not elect to itemize deductions. This standard deduction is incorporated into the tax rate and table schedules. A taxpayer who elects to itemize deductions may deduct only the excess over the standard deduction amount to determine taxable income.
individual taxpayer alternative to itemizing deductions. Current tax rules index the standard deduction to inflation, adjusting annually. They are:
| 2006 | |
| Single Taxpayer | $5,000 |
| Head of Household | $7,300 |
| Married Filing Jointly | $10,000 |
| Married Filing Separately | $5,000 |
provision allowing a taxpayer to deduct, in lieu of itemized deductions, a certain amount of income from his or her gross income . These amounts are indexed for inflation each year and were as follows for 2006:
| Married couples filing jointly | $10,300 |
| Heads of households | 7,550 |
| Single individuals | 5,150 |
| Married couples filing separately | 5,150 |
There are more restrictive limits on the standard deduction allowed to those fro whom a dependency deduction is allowable to another taxpayer. An additional (above the amounts in the table above) is allowed for taxpayers age 65 or above or who are blind.
Copyright © 2006, 2003, 1998, 1995, 1991, 1987, 1985 by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
Copyright © 2007, 2000, 1997, 1987, by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
