Standard Deduction

Most taxpayers have a choice of either taking a standard deduction or itemizing their deductions. The standard deduction is a dollar amount that reduces the amount of income on which you are taxed. It is a benefit that eliminates the need for many taxpayers to itemize actual deductions. The standard deduction is higher for taxpayers who are 65 or older or blind. If you have a choice, you should use the method that gives you the lower tax.

You benefit from the standard deduction if your standard deduction is more than the total of your allowable itemized deductions.

Persons not eligible for the standard deduction. Your standard deduction is zero and you should itemize any deductions you have if:

1. You are married and filing a separate return, and your spouse itemizes deductions,
2. You are filing a tax return for a short tax year because of a change in your annual accounting period, or
3. You are a nonresident or dual-status alien during the year. You are considered a dual-status alien if you were both a nonresident alien and a resident alien during the year. If you are a nonresident alien who is married to a U.S. citizen or resident at the end of the year, you can choose to be treated as a U.S. resident. See Publication 519, U.S. Tax Guide for Aliens. If you make this choice, you can take the standard deduction.

Higher standard deduction for age 65 or older. If you do not itemize deductions, you are entitled to a higher standard deduction if you are age 65 or older at the end of the year. You are considered 65 on the day before your 65th birthday. Therefore, you can take the higher standard deduction for 2000 if your 65th birthday was on or before January 1, 2001.

Higher standard deduction for blindness. If you are blind on the last day of the year and you do not itemize deductions, you are entitled to a higher standard deduction. You qualify for this benefit if you are totally or partly blind.

Partly blind. If you are partly blind, you must get a certified statement from an eye physician or registered optometrist that:

• You cannot see better than 20/200 in the better eye with glasses or contact lenses, or
• Your field of vision is not more than 20 degrees.

If your eye condition will never improve beyond these limits, the statement should include this fact. You must keep the statement in your records.

If your vision can be corrected beyond these limits only by contact lenses that you can wear only briefly because of pain, infection, or ulcers, you can take the higher standard deduction for blindness if you otherwise qualify.

Spouse 65 or older or blind. You can take the higher standard deduction if your spouse is age 65 or older or blind and:

1. You file a joint return, or
2. You file a separate return and can claim an exemption for your spouse because your spouse had no gross income and an exemption for your spouse could not be claimed by another taxpayer.

Decedents. The amount of the standard deduction for a decedent's final return is the same as it would have been had the decedent continued to live. However, if the decedent was not 65 or older at the time of death, the higher standard deduction for age cannot be claimed.

You cannot claim the higher standard deduction for an individual other than yourself and your spouse.

If you are under age 65 and not blind. Use Table 2 in this publication to figure the standard deduction amount you are entitled to.

If you are 65 or older or blind. Use Table 3 in this publication to figure the standard deduction amount you are entitled to.

If an exemption for you can be claimed on another person's return, your standard deduction may be limited. See Standard Deduction for Dependents, later.

If you decide to take the standard deduction. You may find your standard deduction amount by referring to the 2000 Standard Deduction Tables, later, that fit your circumstances.

Example 1. Larry, 66, and Donna, 67, are filing a joint return for 2000. Neither is blind. They decide not to itemize their deductions. They use Table 3. Their standard deduction is $9,050.

Example 2. Assume the same facts as in Example 1 except that Larry is blind at the end of 2000. They use Table 3. Larry and Donna's standard deduction is $9,900.

Example 3. Susan, 67, who is blind, qualifies as head of household in 2000. She has no itemized deductions. She uses Table 3. Her standard deduction is $8,650.

Standard Deduction for Dependents

The standard deduction for an individual for whom an exemption can be claimed on another person's tax return is generally limited to the greater of:

• $700, or
• The individual's earned income for the year plus $250 (but not more than the regular standard deduction amount, $4,400 for a single individual).

However, if you are 65 or older or blind, your standard deduction may be higher. Use Table 4 to determine your standard deduction.

2000 Standard Deduction Tables

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