Why it matters
Itemizing can lower taxable income when the qualifying expenses are larger than the standard deduction. The client needs the supporting records, and some deductions have limits or phase-outs that the preparer must apply.
Example
A client pays mortgage interest, state income tax and a charitable contribution. The preparer adds the qualifying amounts on Schedule A and compares the total with the standard deduction before choosing the larger benefit.
Related terms
Questions about Itemized deduction
What expenses can be itemized?
Common items are mortgage interest, state and local taxes within the limit, charitable contributions, medical expenses above the threshold and certain casualty losses. The rules and limits change, so check the current Schedule A instructions.
What records does an itemized deduction need?
Keep the statements, receipts and acknowledgments that support each amount. A charitable contribution needs a written acknowledgment from the charity for a gift of $250 or more.