Can You Itemize State Taxes if You Don't Itemize Federal?

by Cynthia Gaffney ; Updated March 31, 2018

If you have certain expenditures each year, such as extraordinary medical bills, charitable contributions or mortgage interest, you might want to itemize these on your state income tax return to reduce the taxes you owe. If your expenditures exceed your state's standard deduction, it's worth deducting them by itemizing, even if you don't have enough itemized deductions to surpass the federal standard deduction. Check your state's tax rules because not all states give you the option to itemize expenses on your state return, while others have modified deduction programs.

To Itemize or not to Itemize?

When completing your state and federal income tax returns, you'll find that each allows a "standard deduction" meant to give you a tax break for certain expenditures. At the state level, this standard deduction varies but is likely lower than the federal standard deduction. At the federal level for tax year 2017, the standard deductions ranged from $6,350 for filers with Single status, up to $12,700 for Married Filing Jointly status and Qualifying Widow(er) status.

Stats on State Income Tax Return Rules

According to the Institute on Taxation and Economic Policy, for tax year 2016, 31 states plus the District of Columbia allowed tax filers to itemize expenses on their state income tax returns, following the deductions allowed at the federal level. Some states overlay their own guidelines and limitations on the maximum deductible expenses. Ten states do not allow this type of itemization, and instead have their own tax rules that provide deductions for every taxpayer in the state, not just those that itemize.

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Itemize for State but Not for Federal

If the itemized deductions for your state income tax return equate to less than your federal standard deduction, you could itemize on your state taxes, but wouldn't necessarily want to itemize on your federal taxes. California, for example, allows taxpayers to itemize on their state taxes, whether or not they itemize on their federal return. Since each state has its own tax rules and allowable deductions, check with your state's department of revenue for current procedures on itemizing at the state level, and what that means for your federal tax return.

Following the Federal Precedent

Some states follow the precedent set by your federal income tax filing. For example, if you're filing an income tax return in the state of Georgia, what you do on your federal return dictates how you file your Georgia state return. If you itemize at the federal level or have a spouse that itemizes if you're married but filing separately, you must also itemize on your state income tax return. Conversely, if you take the standard deduction on your federal tax return, you must also take the standard deduction on your Georgia income tax return, even though it may be significantly lower than the federal standard deduction.

About the Author

Cynthia Gaffney started writing in 2007 and has penned tax and finance articles for several different websites. She brings more than 20 years of experience in corporate finance and business ownership. Gaffney holds a Bachelor of Science in finance and business economics from the University of Southern California.

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