Should you take the standard deduction or itemize your deductions for tax year 2026? The answer depends on whether your itemized deductions (SALT capped at $40,400 under the OBBBA, mortgage interest, charitable contributions, and medical expenses above the 7.5% AGI floor) exceed the standard deduction for your filing status ($16,100 single,$32,200 MFJ, $24,150 HoH). Use the calculator below to find out which saves you more.
How the Standard vs Itemized Decision Works
The Standard Deduction
The standard deduction is a fixed amount that reduces your taxable income. For 2026, it is $16,100 for single filers, $32,200 for married filing jointly, and $24,150 for head of household. You get this automatically without having to document individual expenses. About 90% of taxpayers take the standard deduction.
Itemized Deductions
Itemizing lets you deduct specific expenses on Schedule A. The major itemized deductions are:
State and local taxes (SALT): Income tax (or sales tax) and property tax, capped at $40,400 for 2026
Mortgage interest: Interest on up to $750,000 of mortgage debt on your primary or second home
Charitable contributions: Donations to qualified 501(c)(3) organizations
Medical expenses: Only the portion exceeding 7.5% of your AGI
The OBBBA's Impact
The One Big Beautiful Bill Act (OBBBA) raised the SALT cap from $10,000 to $40,400, making itemizing more attractive for taxpayers in high-tax states. At the same time, the OBBBA maintained the higher standard deductions introduced by the TCJA. Together, these changes mean more taxpayers in high-tax states may benefit from itemizing in 2026 compared to prior years.
Worked Examples
Example 1: Standard Deduction Wins, Low Itemized Total
Profile: Single filer, $60,000 AGI
SALT: $5,000 Mortgage interest: $4,000 Charity: $1,000 Medical: $2,000 − 7.5% floor ($4,500) = $0 Total itemized: $10,000 Standard deduction: $16,100 Standard deduction saves $6,100 more, take the standard deduction
Example 3: SALT Over the Cap, Still Better to Itemize
Profile: Single filer, $150,000 AGI, high SALT state
SALT paid: $50,000, but capped at $40,400, deductible: $40,400 ($9,600 lost to cap) Mortgage interest: $10,000 Charity: $3,000 Medical: $1,000 − 7.5% floor ($11,250) = $0 Total itemized: $53,400 Standard deduction: $16,100 Itemizing saves $37,300 more, itemize despite SALT cap
Frequently Asked Questions
What is the standard deduction for 2026?
The standard deduction for 2026 is $16,100 for single filers, $32,200 for married filing jointly, and $24,150 for head of household. These amounts are increased under the OBBBA and indexed for inflation.
When should I itemize instead of taking the standard deduction?
You should itemize when your total itemized deductions exceed the standard deduction for your filing status. Common itemized deductions include state and local taxes (SALT, capped at $40,400), mortgage interest, charitable contributions, and medical expenses exceeding 7.5% of your AGI. If these combined total more than $16,100 (single) or $32,200 (MFJ), itemizing saves you money.
What is the SALT cap for itemized deductions?
The SALT deduction is capped at $40,400 for 2026 under the OBBBA. This is a significant increase from the $10,000 cap that applied from 2018–2025. The cap covers all state and local taxes combined, income tax (or sales tax), and property tax. Any SALT paid above this cap is not deductible.
How does the medical expense deduction work?
You can deduct medical and dental expenses that exceed 7.5% of your AGI. For example, if your AGI is $100,000, only medical expenses above $7,500 are deductible. Qualifying expenses include doctor visits, prescriptions, health insurance premiums (not paid pre-tax), dental work, vision care, and long-term care expenses.
Can I switch between standard and itemized deductions each year?
Yes. You can choose whichever method gives you the larger deduction each year. There is no requirement to stick with one method. Many taxpayers alternate depending on whether they had large medical bills, made significant charitable donations, or paid substantial SALT in a given year.
What charitable contributions are deductible?
Cash and property donations to qualified 501(c)(3) organizations are deductible if you itemize. Cash donations are generally deductible up to 60% of your AGI. You must have written acknowledgment from the charity for donations of $250 or more. Donations to individuals, political organizations, or candidates are not deductible.
Is mortgage interest still deductible?
Yes. Mortgage interest on your primary residence (and one additional home) is deductible if you itemize. For mortgages originated after December 15, 2017, the deduction is limited to interest on the first $750,000 of mortgage debt ($375,000 if married filing separately). Mortgages before that date are grandfathered at the $1 million limit.
Does the OBBBA change the standard deduction?
Yes. The OBBBA maintained the higher standard deduction amounts that were introduced by the TCJA and indexed them for inflation. For 2026, the standard deduction is $16,100 (single), $32,200 (MFJ), or $24,150 (HoH). These amounts are significantly higher than the pre-TCJA levels.
Standard vs Itemized Deduction Calculator
Itemizing Is BetterItemizing ($20,000.00) saves you $3,900.00 more than the standard deduction ($16,100.00)
Deduction
Amount
Standard Deduction
$16,100.00
Itemized Deductions Breakdown
SALT (capped at $40,400.00)
$10,000.00
Mortgage Interest
$8,000.00
Charitable Contributions
$2,000.00
Medical Expenses (above 7.5% AGI floor of $5,625.00)
$0.00
Total Itemized Deductions
$20,000.00
Difference
-$3,900.00 (itemizing wins)
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