What Is Schedule A (Form 1040 or 1040-SR): Itemized Deductions?
Schedule A (Form 1040 or 1040-SR): Itemized Deductions is an Internal Revenue Service (IRS) form for U.S. taxpayers who itemize their tax-deductible expenses rather than take the standard deduction. Schedule A is an attachment to Form 1040 that U.S. taxpayers use to report their annual income taxes.
- Schedule A is the tax form used by taxpayers who itemize their deductible expenses rather than take the standard deduction.
- The Tax Cuts and Jobs Act, passed in 2017, limited the amount taxpayers can deduct for state and local taxes and nearly doubled the standard deduction.
- A taxpayer with significant eligible expenses which exceed the standard deduction will file a Schedule A.
- Eligible deductions may include qualified medical expenses, state and local taxes, mortgage interest, sales tax payments, and some charitable contributions.
Who Can File Schedule A?
Any U.S. taxpayer can file a Schedule A Form and claim itemized deductions as an alternative to taking the standard deduction, choosing the option that provides greater tax savings.
Eligible deductions may include qualified medical expenses, a portion of state and local taxes, mortgage interest, certain sales tax payments, and some charitable contributions.
- For the tax year 2022, the standard deduction for single taxpayers and married couples filing separately is $12,950. For married couples filing jointly, it is $25,900, and for heads of households, it is $19,400.
- For the tax year 2023, the standard deduction for single taxpayers and married couples filing separately is $13,850. For married couples filing jointly, it is $27,700, and for heads of households, it is $20,800.
Many taxpayers who once itemized their deductions on Schedule A have found it more advantageous to claim the standard deduction. The Tax Cuts and Jobs Act, passed in 2017, limits the amount taxpayers can deduct for state and local taxes to a maximum of $10,000 for married couples or $5,000 for married taxpayers filing separately. The law nearly doubled the previous standard deduction.
Who Benefits From Filing Schedule A?
For residents of high-tax states, the $10,000 limit on deductions for state and local taxes may be a deciding factor. If a married couple in the state cannot find an additional $14,000 in eligible deductions on top of the $10,000, they'll likely choose the standard deduction.
Many taxpayers have eligible deductions which total less than the standard deduction and do not need to keep track of their expenses or collect their receipts. Additionally, itemized deductions are subject to challenge by the Internal Revenue Service (IRS), while taking the standard deduction is not.
When a taxpayer has significant eligible expenses which exceed the standard deduction, filing Schedule A makes sense. Mortgage interest on an expensive home is often a good benchmark for deciding which to choose.
You can deduct home mortgage interest on the first $750,000 ($375,000 if married, filing separately) of indebtedness. However, higher limitations of $1 million or $500,000 if married filing separately apply if you deduct mortgage interest from debt incurred before December 16, 2017.
If your annual mortgage interest found on your Mortgage Interest Statement, or Form 1098, is higher than the standard deduction, it is advantageous to itemize deductions on Schedule A.
How to File Schedule A
The instructions for Schedule A explain which of your expenses are deductible and where they should be listed on the form.
Schedule A can be downloaded on the IRS website.
Schedule A requires taxpayers to list their deductible expenses in any or all of the six designated categories:
- Medical and dental expenses
- Taxes you paid
- Interest you paid
- Gifts to charity
- Casualty and theft losses (but only if the property is located in a federally-declared disaster area)
- Other itemized deductions
Like the standard deduction, the itemized deductions on Schedule A are subtracted from the taxpayer's adjusted gross income (AGI) to determine taxable income. If you itemize your deductions, save documentation of eligible expenses throughout the year, including receipts, invoices, and images of canceled checks.
What Is a Schedule A?
Schedule A is an Internal Revenue Service (IRS) tax form to list itemized deductions when filing taxes. Itemized deductions reduce your taxable income. Filers can choose between either the standard deduction or itemized deduction.
What Can Be Claimed on Schedule A?
Schedule A is used to claim itemized deductions that reduce your taxable income and the total amount of taxes you pay. The categories that can be itemized include taxes, interest paid, gifts to charity, medical and dental expenses, casualty and theft losses, and other miscellaneous expenses.
What Cannot Be Itemized on Schedule A?
Some items which cannot be itemized on Schedule A include federal income and excise taxes, Social Security or Medicare taxes, federal unemployment (FUTA), railroad retirement taxes (RRTA), customs duties, federal gift taxes, per capita taxes, or foreign real property taxes.
Who Files Schedule A?
U.S. taxpayers file Schedule A when itemizing deductions when filing their tax returns. Taxpayers are allowed to either use the standard deduction or itemize deductions. The goal is to choose the method that results in the greatest savings in tax payment.
The Bottom Line
Schedule A is the tax form used by taxpayers who itemize their deductible expenses rather than take the standard deduction. A taxpayer with significant eligible expenses that exceed the standard deduction will file a Schedule A and may be able to claim qualified medical costs, state and local taxes, mortgage interest, sales tax payments, and some charitable contributions.