Definition
A fixed deduction from taxable income that taxpayers can take without itemising. Roughly $14k single / $29k married filing jointly in 2024.
Related Tax & Accounting terms
AGI (Adjusted Gross Income)
Your total income minus specific deductions (like retirement contributions and s…
Tax Bracket
A range of income taxed at a particular rate. The U.S. uses a progressive system…
Marginal Tax Rate
The tax rate applied to your next dollar of income — your top bracket. Often hig…
Effective Tax Rate
Total tax paid divided by total income. The true average rate, typically lower t…
Itemized Deduction
Listing specific eligible expenses (mortgage interest, charitable gifts, SALT, e…
Tax Credit
A dollar-for-dollar reduction of tax owed (e.g. Child Tax Credit). More valuable…
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