Sam and Diane are completing their federal income taxes for the year and have identified the amounts listed here. How much can they rightfully deduct?
• AGI: $80,000
• Medical and dental expenses: $9,000
• State income taxes: $3,500
• Mortgage interest: $9,500
• Charitable contributions: $1,000

Question

Sam and Diane are completing their federal income taxes for the year and have identified the amounts listed here. How much can they rightfully deduct? 
• AGI: $80,000
• Medical and dental expenses: $9,000
• State income taxes: $3,500
• Mortgage interest: $9,500
• Charitable contributions: $1,000

Quizplus · Accepted Answer

To determine the amount they can rightfully deduct, Sam and Diane would need to compare their itemized deductions to the standard deduction. For 2020, the standard deduction for a married couple filing jointly is $24,800.

When you add up their itemized deductions, you get:

$9,000 (medical and dental expenses) +
$3,500 (state income taxes) +
$9,500 (mortgage interest) +
$1,000 (charitable contributions) = 
$23,000

Since $23,000 is less than the standard deduction of $24,800, the best choice for how much they can rightfully deduct is $15,000 (the standard deduction).

Sam and Diane Are Completing Their Federal Income Taxes for the Year