Itemized Deduction Calculator: Calculate Your Eligible Expenses
See if you should itemize with our itemized deduction calculator. Input mortgage interest, state taxes (SALT), and contributions to maximize savings now.
Itemized Deduction Calculator: Calculate Your Eligible Expenses
Enter your details below to calculate
State and Local Taxes (SALT)
SALT limit (2025): $20,000
Home-Related Deductions
Charitable Contributions
Medical Expenses
Medical floor: 5% of AGI ($3,750)
Other Deductions
How to Use Itemized Deduction Calculator
Enter Your Data
Input your financial information, amounts, rates, and terms in the calculator fields
Adjust Parameters
Fine-tune options like compounding frequency, payment schedules, or additional contributions
Calculate Results
Click Calculate to instantly see your results with detailed breakdowns and charts
Analyze & Compare
Review the results, try different scenarios, and use insights for financial planning
Key Features
Fast itemized deduction calculator calculations
Clear inputs and results
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What Are Itemized Deductions and How Do They Work in 2025?
Itemized deductions are specific expenses you can subtract from your adjusted gross income (AGI) to reduce your federal taxable income. Unlike the standard deduction, which provides a flat amount based on filing status, itemizing allows you to claim actual expenses in specific categories recognized by the IRS. This approach can be financially advantageous when your qualifying expenses exceed the standard deduction amount.
In 2025, significant changes to deduction rules make itemizing more attractive for many taxpayers. The SALT (State and Local Taxes) deduction cap has quadrupled to $40,000 for joint filers ($20,000 for single filers) through 2029, while the medical expense floor has been reduced to 5% of AGI. These changes, combined with higher standard deductions, create a new landscape where strategic taxpayers can potentially save thousands by carefully tracking and claiming legitimate expenses.
Key Statistic: Despite the increased standard deduction, approximately 15-20% of taxpayers still benefit from itemizing in 2025, with average itemized deductions ranging from $25,000 to $45,000 depending on income level and geographic location.
2025 Itemized Deduction Categories: What's Deductible and What's Not
Understanding which expenses qualify for itemization is crucial for maximizing your tax savings. The IRS recognizes several main categories, each with specific rules, limits, and documentation requirements. Here's a comprehensive breakdown of the most significant deductible expenses for 2025.
State and Local Taxes (SALT)
2025 Cap: $40,000 joint, $20,000 single
- State and local income taxes
- State and local sales taxes (choose income or sales)
- Real property taxes
- Personal property taxes
Strategy: Consider prepaying property taxes or state estimated payments in December to maximize current year deduction before hitting cap.
Home Mortgage Interest
Limits: Interest on up to $750K mortgage debt
- Primary home mortgage interest
- Second home mortgage interest
- Home equity loan interest (if used for home)
- Mortgage insurance premiums
Important: Points paid on new mortgage are deductible in year paid. Refinanced points must be amortized.
Charitable Contributions
AGI Limits: 60% for cash, 50% for non-cash
- Cash donations to qualified charities
- Non-cash donations (fair market value)
- Mileage for charitable work
- Out-of-pocket expenses volunteering
Documentation: Receipts required for all cash donations. Non-cash items $250+ need acknowledgment letter.
Medical Expenses
2025 Floor: 5% of AGI (reduced from 7.5%)
- Doctor and hospital bills
- Prescription medications
- Health insurance premiums
- Medical mileage and travel
Key Change: The reduced 5% floor makes it easier to qualify, especially for seniors and those with chronic conditions.
Miscellaneous Deductions (Limited Availability)
Investment Interest
Limited to net investment income
Gambling Losses
Up to gambling winnings amount
Casualty/Theft Losses
After $100 per event, 10% AGI floor
How to Maximize Your 2025 Itemized Deductions: A Step-by-Step Strategy
Successfully itemizing deductions requires strategic planning throughout the year and meticulous record-keeping. Follow this systematic approach to ensure you capture every legitimate deduction while staying compliant with IRS requirements.
Track SALT Payments Year-Round
Keep detailed records of all state and local tax payments:
- State income tax withholding (W-2, 1099)
- Estimated quarterly tax payments
- Property tax assessments and payments
- Vehicle registration fees (portion that's property tax)
Pro Tip: Consider bunching SALT payments in December if you're close to the cap threshold, but be aware of AMT implications.
Document All Charitable Giving
Maintain comprehensive donation records:
Cash Donations
- Bank statements
- Canceled checks
- Credit card statements
- Charity acknowledgment letters
Non-Cash Donations
- Detailed inventory list
- Fair market valuation
- Charity acknowledgment
- Photos of donated items
Calculate Medical Expense Threshold
Track and time medical expenses strategically:
- Keep all receipts for qualifying medical expenses
- Include mileage to medical appointments (22 cents/mile in 2025)
- Don't forget health insurance premiums (after-tax portion)
- Consider bunching elective procedures in high-expense years
2025 Advantage: With only 5% AGI floor, a taxpayer with $75,000 AGI needs just $3,750 in expenses to start deducting, compared to $5,625 under old rules.
Important Tax Disclaimer
This calculator provides estimates based on 2025 IRS itemized deduction rules and should be used for informational purposes only. Tax laws are subject to change, and individual circumstances vary significantly. The SALT deduction cap, medical expense floor, and other provisions discussed are based on current legislation but may be modified. Always consult a qualified tax professional regarding your specific situation. We are not responsible for any tax decisions or outcomes based on the use of this calculator.
About the Author
Jurica Šinko
Finance Expert, CPA, MBA with 15+ years in corporate finance and investment management
Connect with JuricaFrequently Asked Questions
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