Ask an Advisor: Should I Start Itemizing My Taxes Now That Trump's 'Big Beautiful Bill' Is Law?"

The Tax Cuts and Jobs Act of 2017 nearly doubled the standard deduction, leading about 90% of taxpayers to go this route instead of itemizing their deductions. You’re likely among them. But with the passage of the “One Big Beautiful Bill Act,” signed into law on July 4, 2025, you may be wondering whether it’s time to start itemizing. Here’s a look at some key changes that could affect your decision.

A financial advisor can help you comprehend changing tax laws and make strategic changes to your financial plan.

Itemized Deductions vs. Standard Deduction

First, let’s frame the issue of deciding between standard and itemized deductions.

Deductions reduce your taxable income, thereby lowering the amount of tax you owe. When you file your tax return you have a choice between taking the standard deduction or itemizing your deductions. You can’t do both. It’s a simple matter of deciding which one reduces your taxable income the most.

The standard deduction is a flat dollar amount that you can claim based on your filing status. You don’t have to add anything up or track expenses to get it. Before the One Big Beautiful Bill Act, the standard deduction for 2025 was $15,000 for single filers and $30,000 for married couple filing a joint return.

Itemized deductions are individual deductions you take based on your financial activity. These include things like:

Mortgage interest
State and local taxes (SALT)
Charitable contributions
Medical expenses in excess of certain AGI thresholds

If you itemize, that means you add up each of these individual deductions and deduct the total from your income. (A financial advisor who offers tax planning services can walk through your eligible deductions and help you decide which filing method lowers your tax bill the most.)

How Does the Trump Tax Law Affect My Decision to Itemize?

The new law extends many TCJA provisions that were scheduled to sunset at the end of 2025. Namely, we will keep the same tax brackets rather than revert to pre-TCJA brackets. It also enhances aspects of both the standard deduction and certain itemized deductions. Here’s a breakdown of some of the most prominent provisions of the law:

Higher Standard Deduction

The bill boosts the standard deduction for singles by $750 to $15,750 in 2025, while married couples who file a joint return will see their standard deduction increase by $1,500 to $31,500. This of course makes the standard deduction more valuable than it was before.

Additional Deduction for Seniors 65 and Older

In addition to the higher standard deduction, each person who is at least 65 years old can also claim another $6,000 deduction regardless of whether or not they itemize. However, this begins to phase out at a rate of 6% of modified adjusted gross income (MAGI) over $75,000 for single filers, and over $150,000 for joint filers. The deduction cannot go below zero.

Let’s say you’re a single filer with a modified adjusted gross income of $85,000. That puts you $10,000 over the phaseout threshold for the senior deduction. Under the new rules, you’d lose 6% of that excess—$600—leaving you with a $5,400 deduction. Now imagine your income climbs to $175,000. That’s $100,000 over the threshold, which wipes out the deduction entirely.

(Working with a financial advisor may clarify whether recent tax changes shift the balance between taking the standard deduction and itemizing.)

Higher SALT Deduction Limit

The SALT deduction cap increases from $10,000 to $40,000 (plus a 1% inflation adjustment) for 2025 through 2029. If your state and local taxes are high, this could increase your incentive to itemize. However, like the senior deduction, the increased SALT cap is also subject to a phaseout. It begins at $500,000 of income. If your income is $600,000 or higher you will be limited to a $10,000 SALT deduction.

Other Relevant Changes

There are several other aspects of the law that may affect your choice between itemizing or taking the standard deduction. These include:

Charitable deductions: Beginning in 2026, charitable deductions will be subject to a floor of 0.5% of AGI. In other words, in order to claim a charitable deduction your donations must be greater than 0.5% of your AGI.
Deductions for tips and overtime income: A filer can deduct up to $25,000 in tips and overtime income, regardless of whether they itemize. Phaseouts for each of these begin at $150,000 for single filers and $300,000 for couples.

Should You Itemize or Take the Standard Deduction?

The One Big Beautiful Bill Act has changed some of the math behind this decision—but not the basic approach. You still determine whether to itemize or take the standard deduction by comparing both options under the new rules and choosing the one that results in the lowest taxable income.

That may sound simple in concept but feel difficult in practice. This is where a tax accountant or financial advisor can be especially helpful. They can help you navigate how recent changes, like the increase in the SALT deduction cap, might tip the scale.

For example, under prior law, a married couple filing jointly who paid $25,000 in state and local taxes couldn’t deduct more than $10,000, which meant they often didn’t have enough total deductions to itemize. But under the new law, the SALT cap increases to $40,000 for 2025. That same couple may now be able to deduct the full $25,000, plus mortgage interest and charitable donations—pushing their total itemized deductions above the standard deduction and making itemizing the better financial choice for that year.

(And if you need help finding a financial advisor, this free tool can connect you with fiduciary advisors who serve your area.)

Bottom Line

The One Big Beautiful Bill Act is now law. It extends many provisions from the 2017 Tax Cuts and Jobs Act and introduces new rules that could significantly impact your future tax liability. Navigating the tax code is always important—but with these recent changes, many of which may be unfamiliar, it’s more essential than ever to review your situation carefully.

Tax Planning Tips

A financial advisor can help you assess your investment portfolio and potentially help you optimize it from a tax perspective. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
If you’re close to the threshold for a higher tax bracket, consider deferring income—such as year-end bonuses or capital gains—to the following tax year. Likewise, accelerating deductible expenses like charitable contributions or medical costs into the current year can reduce your taxable income.

Brandon Renfro, CFP®, is a SmartAsset financial planning columnist and answers reader questions on personal finance and tax topics. Got a question you’d like answered? Email AskAnAdvisor@smartasset.com and your question may be answered in a future column.

Please note that Brandon is not an employee of SmartAsset and is not a participant in SmartAsset AMP. He has been compensated for this article. Some reader-submitted questions are edited for clarity or brevity.