Amounts allowed to taxpayers under the Internal Revenue Code as offsets against gross income or adjusted gross income. See income; tax deduction.
itemized deductions deductions allowed under the various provisions of the Code for specific costs or expenses incurred by the taxpayer during the taxable year. These deductions are allowed in computing taxable income. An individual whose adjusted gross income exceeds a specified threshold amount must reduce the amount of otherwise allowable itemized deductions. I.R.C. §63(d).
marital deduction an amount allowed as a deduction for federal estate and gift tax purposes for certain interests in property transferred to a spouse. The deduction is currently unlimited in amount. I.R.C. §2056. See also marital deduction.
personal expenses deductions personal expenses as opposed to expenses for income producing or business expenses. In general, personal expenses are not allowed as deductions, except for certain expenses such as taxes, interest payments, etc., as specifically enumerated in the Internal Revenue Code. I.R.C. §262.
standard deduction taxpayers who do not itemize their deductions are entitled to a standard deduction, I.R.C. §63(c). The amount of the standard deduction varies according to the taxpayer's filing status. Taxpayers who are age 65 or older, or who are blind, receive an additional standard deduction amount that is added to the basic standard deduction.
