itemized deductions

Are you making the common mistake of just adding up all the amounts for your itemized deductions without considering the caps and thresholds that must be met?

STANDARD DEDUCTION

Many taxpayers are surprised because their itemized deductions are not having the same effect as they did on past tax returns.  The new higher standard deduction and the elimination of certain deductions, as well as the cap on state and local taxes have had a major impact since the new tax laws went into effect beginning with 2018 returns.

Your itemized deductions have to be more than your standard deduction before you will see a change in your tax owed or tax refund.  The deductions you enter do not necessarily count “dollar for dollar;” many of them are subject to meeting  tough thresholds—medical expenses, for example, must meet a threshold that is pretty hard to reach. (Only the amount that is MORE than 7.5% of your AGI counts)   The software program uses all the IRS rules that apply to the expenses you enter, and it tells you if you have enough to use your itemized deductions or if using the standard deduction is more advantageous for you.  Under the new tax laws, some deductions have been capped—there is a $10,000 limit to the itemized deductions for state, local, property and sales taxes.

Your standard deduction lowers your taxable income.  It is not a refund.  You will see your standard or itemized deduction amount on line 12a of your 2021 Form 1040.

2021 STANDARD DEDUCTION AMOUNTS

SINGLE $12,550  (65 or older + $1700)

MARRIED FILING SEPARATELY $12,550  (65 or older + $1350)

MARRIED FILING JOINTLY $25,100  (65 or older + $1350 per spouse)

HEAD OF HOUSEHOLD  $18,800  (65 or older +$1700)

Legally Blind + $1350

It is possible that it might be selecting the standard deduction because the standard deduction plus the charitable deduction allowed to all taxpayers in 2021 is greater than the itemized deductions. 

You can switch between itemized and standard deductions to see the impact it has on your federal refund. Depending on the state you live in, it may impact that as well. To do that:

1. With your tax return open, select Federal from the navigation menu on the left (if you're doing this on a mobile device, you'll probably need to scroll down).
2. Now select Deductions & Credits near the top of your screen.
3. Once all your deductions are entered, select Wrap up tax breaks. Eventually, you'll come to the screen Based on what you just told us, the Standard Deduction is best for you or Based on what you just told us, itemizing deductions is best for you. 
4. On that screen, select Change my deduction. You'll get a pop-up showing how much each deduction is worth. As @xmasbaby0 said, it is possible your itemized deductions aren't entirely deductible. This is particularly true if you tried to deduct medical expenses, had state and local taxes in excess of $10,000, or had a mortgage on your home with an outstanding principal above $750,000.
5. From here, you can either change your deduction by selecting it and continuing forward or cancel out.