Taxpayers to Get Bigger Standard Deductions in 2025

Deductions to Offset Inflation

To keep up with rising inflation and its effect on taxpayers, the Internal Revenue Service (IRS) is gradually increasing the standard deduction amounts for all filing statuses.

Standard Deduction Increases

The standard deduction, a specific amount that can be subtracted from taxable income before taxes are calculated, will see the following increases for 2025:

• Single: $13,850 (up from $13,450 in 2024)
• Married filing jointly: $27,700 (up from $27,300 in 2024)
• Married filing separately: $13,850 (up from $13,450 in 2024)
• Head of household: $20,800 (up from $20,400 in 2024)

Gradual Increases

These increases are part of a gradual adjustment plan implemented by the IRS to keep standard deduction amounts in line with inflation. The plan began in 2023 and will continue until 2026.

Benefits of Increased Deductions

Higher standard deductions benefit taxpayers by reducing their taxable income. This can result in lower tax bills, especially for those who do not itemize their deductions. Itemizing deductions requires taxpayers to have expenses that exceed the standard deduction amount.

Conclusion

The increased standard deductions for 2025 will provide additional tax relief to taxpayers in all filing statuses. Taxpayers should be aware of these increases and consider their impact on their tax planning for the upcoming year.