Itemizing vs. Standard Deductions: What’s Changed Under the One Big Beautiful Bill Act?

One of the biggest decisions filers make come tax season is whether to take the standard deduction or itemized deductions on their returns. Oftentimes, you’re stuck with the same method for years based on your filing status, employment status, property, etc.

However, under the One Big Beautiful Bill Act (OBBB),  there are some updates that may change your mind. Certain filers can now expect to see new deductions and higher write-off limits, making itemizing a more appealing option.

Curious if that means you? 

Keep reading our blog to understand:

• The changes the OBBB makes for standard deductions and itemizing

• The qualifications you need to meet to take advantage of them

• What to consider when choosing your best filing option

  
  

What Tax Deductions Change Under the One Big Beautiful Bill Act?

The OBBB introduced some permanent and temporary changes to federal income taxes starting tax year 2025. 

1. Changes to Standard Deductions

Standard deductions, a fixed amount that reduces the amount of your income subject to tax, have now permanently increased to account for inflation. Going forward, the amounts will continue to account for further inflation.

For the 2025 tax year, they are:

• $31,500 for married couples filing jointly

• $15,750 for single filers and married individuals filing separately

• $23,625 for heads of household

  
  

2. New Deductions for Seniors

Under the OBBB,  taxpayers aged 65 or older can now take advantage of temporary additional deductions for tax years 2025 to 2028.

So long as filers are 65 on or before the last day of the tax year, they can claim:

• $6,000 per individual

• $12,000 for married couples filing jointly (if both spouses qualify)

Important to note:

Seniors (those 65 or older) can claim this deduction in addition to standard or itemized deductions. However, for those with an adjusted gross income over $75,000, or $150,000 for joint filers, this deduction phases out.

3. Changes to Itemized Deductions

Some tax filers, particularly homeowners, can now take advantage of temporary increases to State and Local Tax (SALT) deduction caps for the 2025 tax year. These changes particularly benefit taxpayers in areas with higher property taxes, such as those in Nassau and Suffolk counties and Connecticut.

Looking for more information on updated SALT deductions? We have a full blog dedicated to the changes.

These updates can have big impacts on your tax filings— and leave you wondering what your best options will be come filing season.

Should I Take the Standard Deduction or Itemize?

Deciding whether to itemize deductions or take the standard deduction really comes down to one thing: comparing your totals. To choose the right option, you need to do a bit of math.

Deductions Checklist

First, you need to figure out how your itemized deductions compare to the updated standard deduction. 

Some of the most common itemized deductions you can take advantage of include:

• Mortgage interest 

• Mortgage insurance premiums

• SALT deductions

• Qualified medical and dental expenses

• Qualified charitable contributions

Special circumstances, such as casualty + theft losses and tips + overtime, may also apply depending on your situation. It's also important to remember that you can only take advantage of certain deductions, such as SALT, if you itemize.

If your itemized deductions exceed the standard deduction, you're likely better off filing that way. However, if the new standard deductions are higher than your itemized deductions, that may be the better route to go.

While you may be looking for a definitive answer on the best way to file your tax deductions, it isn't that black and white. It all depends on your unique filing situation— which is why turning to the professionals for guidance is always wise.

Claim Every Qualified Deduction with AVM DeMars

When tax rules change, having an experienced advocate matters. Our professionals at AVM DeMars bring deep federal and multi-state tax expertise to help you make informed decisions that put you in the best spot possible during tax season.

We’re your trusted tax advocates in New York, New Jersey, and Connecticut. Reach out today to get a head start on tax season.