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In partnership with
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Every Saturday, we open the mailbag, pour some strong coffee, and tackle the tax questions keeping America awake at 2 a.m. Here’s this week’s question:
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Is it better to take the standard deduction or try to itemize in 2026?
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We usually love the standard deduction. It’s the “easy button” of taxes — no receipt hoarding required.
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But the new tax law (the One Big Beautiful Bill Act, or OBBBA) has shaken up our world for 2026, making us wonder if we should start saving receipts again.
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The “Easy Button” (Standard Deduction)
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For the 2025 tax season, the standard deduction amounts are huge:
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Single: $15,750
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Married Filing Jointly: $31,500
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Head of Household: $23,625
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If your deductible expenses are less than these numbers, take the standard deduction and run.
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The “Itemizing” Adventure
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Usually, itemizing is a pain. But for 2025 taxes, the government raised the SALT Cap (State and Local Tax deduction) from the old $10,000 limit to $40,000.
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This is a big deal. If you live in a high-tax state (looking at you, New York and California), you can now deduct way more of your property and income taxes.
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Even better? The “traps” coming in 2026 haven’t started yet. For the 2025 tax year, the rules are still in your favor:
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Charity: No 0.5 percent floor yet. You can generally deduct cash donations up to 60 percent of your adjusted gross income.
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Gambling: You can still deduct losses up to 100 percent of your winnings (the “90 percent” rule waits until next year).
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Pease Limitation: Still suspended for 2025.
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For most of us, the standard deduction ($31,500 for couples!) is still the winner. But with the SALT cap at $40,000 and no new restrictions yet, tax year 2025 might be the best year to itemize we’ve seen in a long time.
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We suggest doing a quick “napkin math” check before tossing your receipts this year. Your peace of mind (and wallet) will thank you.
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PS: If you have decided that reading about tax regulations on a weekend is a form of mild torture you no longer wish to endure, you can click here to opt out. We’ll miss you, but we won’t hold a grudge.
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PRESENTED BY FISHER INVESTMENTS
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When Is the Right Time to Retire?
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Determining when to retire is one of life’s biggest decisions, and the right time depends on your personal vision for the future. Have you considered what your retirement will look like, how long your money needs to last and what your expenses will be? Answering these questions is the first step toward building a successful retirement plan.
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Our guide, When to Retire: A Quick and Easy Planning Guide, walks you through these critical steps. Learn ways to define your goals and align your investment strategy to meet them. If you have $1,000,000 or more saved, download your free guide to start planning for the retirement you’ve worked for.
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Find Your Retirement Timeline
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