Taxes

2007 deduction amounts

By Kay Bell
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  • 3 min read

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Standard deduction amounts
The amount you can claim depends upon your filing status and age.

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For taxpayers younger than 65, the amounts are:

Standard deductions
Single
$5,350
Head of household
$7,850
Married filing jointly
$10,700
Qualifying widow or widower
$10,700
Married filing separately
$5,350

Standard deductions for older, visually impaired taxpayers
Taxpayers age 65 or older, as well as visually impaired/blind filers, are allowed larger standard deduction amounts. To determine which amount you can claim, you must check the appropriate boxes on your Form 1040 or Form 1040A (Form 1040EZ is not available to filers age 65 or older):

You were born before Jan. 2, 1943.*
Your spouse was born before Jan. 2, 1943.*
You are blind.**
Your spouse is blind.**

Based on the number of boxes checked, your standard deduction will be:

Standard deductions: 65+ or visually impaired
Filing status
Number of boxes checked
Standard deduction amount
Single
1

2
$6,650

$7,950
Married filing jointly
1

2

3

4
$11,750

$12,800

$13,850

$14,900
Married filing separately
1

2

3

4
$6,400

$7,450

$8,500

$9,550
Head of Household
1

2
$9,150

$10,450

* If your 65th birthday is Jan. 1, the IRS considers you age 65 for the previous tax year and you may claim the larger standard deduction.

** You may qualify for the larger deduction even if you are partially blind by attaching a letter from your physician attesting to your limited vision.
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Filing requirements, standard deductions for dependent taxpayers
Sometimes you might file a return, for example, to get a refund of withheld money, even though you can be claimed as a dependent on someone else’s return.

In this case, a dependent taxpayer who is younger than 65 and not blind can take as a standard deduction the greater of $850 or his or her earned income plus $300. This deduction amount, however, cannot exceed the basic standard deductions for the dependent taxpayer’s filing status.

As with the basic standard deduction amounts, older and visually impaired taxpayers who also are dependents are allowed larger deduction amounts.

If you can be claimed as a dependent of another taxpayer, you still have to file if you meet certain earning thresholds. Both single and married dependents must file a tax return if any of the following apply: more than $850 in unearned income; more than $5,150 in earned income; or gross income (a combination of earned and unearned money) that is larger than at least $850 or the gross amount plus $300.

In addition, older taxpayers who can be claimed as dependents are allowed to earn more before they must file a return:

Earnings thresholds that require filing

by dependent taxpayers age 65+ or visually impaired
Filing status
Age/vision consideration
Base amount
Plus
Single or head of household 65 or blind $850 or earned income plus $300 $1,250
Single or head of household 65 and blind $850 or earned income plus $300 $2,500
Married filing jointly or qualifying widow(er) 65 or blind $850 or earned income plus $300 $1,000
Married filing jointly or qualifying widow(er) 65 and blind $850 or earned income plus $300 $2,000

Itemized deductions
All taxpayers may choose to itemize deductions and claim that amount if it is larger than their allowable standard deduction amount.

You must file Form 1040 and Schedule A to itemize.

Some itemized deductions are limited based on a taxpayer’s adjusted gross income. For 2007, the following limits apply to itemized deductions:

Limits on itemized deductions
Medical expenses Amount exceeding 7.5 percent of AGI is deductible.
Mortgage loan interest Fully deductible for loans totaling $1 million or less on your primary residence or second home
Home equity loan interest Generally deductible for loans up to $100,000 that are secured by your home
Charitable contributions Most are fully deductible as long as the gift amount does not exceed 50 percent of AGI
Casualty losses Deductible after subtracting insurance reimbursements, 10 percent of your AGI and $100
Miscellaneous expenses Amount exceeding 2 percent of AGI is deductible

In addition, overall itemized deductions also could be reduced if a taxpayer’s AGI exceeds a certain amount, adjusted annually for inflation. For 2007 returns, the reduction of total itemized deductions begins for a taxpayer with an AGI of $150,500. This income level applies to single, head of household and married filing jointly taxpayers. Taxpayers who are married but file separate returns will see their itemized deductions reduced on AGI of $75,250 or more.
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