26 USC 63 - Taxable income defined

U.S Code last checked for updates: Nov 22, 2024

§ 63.

Taxable income defined

(a)

In general

(b)

Individuals who do not itemize their deductions

In the case of an individual who does not elect to itemize his deductions for the taxable year, for purposes of this subtitle, the term “taxable income” means adjusted gross income, minus—

(1)

the standard deduction,

(2)

the deduction for personal exemptions provided in section 151,

(3)

any deduction provided in section 199A, and

(4)

the deduction provided in section 170(p).

(c)

Standard deduction

For purposes of this subtitle—

(1)

In general

Except as otherwise provided in this subsection, the term “standard deduction” means the sum of—

(A)

the basic standard deduction, and

(B)

the additional standard deduction.

(2)

Basic standard deduction

For purposes of paragraph (1), the basic standard deduction is—

(A)

200 percent of the dollar amount in effect under subparagraph (C) for the taxable year in the case of—

(i)

a joint return, or

(ii)

a surviving spouse (as defined in section 2(a)),

(B)

$4,400 in the case of a head of household (as defined in section 2(b)), or

(C)

$3,000 in any other case.

(3)

Additional standard deduction for aged and blind

(4)

Adjustments for inflation

In the case of any taxable year beginning in a calendar year after 1988, each dollar amount contained in paragraph (2)(B), (2)(C), or (5) or subsection (f) shall be increased by an amount equal to—

(A)

such dollar amount, multiplied by

(B)

the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, by substituting for “calendar year 2016” in subparagraph (A)(ii) thereof—

(i)

“calendar year 1987” in the case of the dollar amounts contained in paragraph (2)(B), (2)(C), or (5)(A) or subsection (f), and

(ii)

“calendar year 1997” in the case of the dollar amount contained in paragraph (5)(B).

(5)

Limitation on basic standard deduction in the case of certain dependents

In the case of an individual with respect to whom a deduction under section 151 is allowable to another taxpayer for a taxable year beginning in the calendar year in which the individual’s taxable year begins, the basic standard deduction applicable to such individual for such individual’s taxable year shall not exceed the greater of—

(A)

$500, or

(B)

the sum of $250 and such individual’s earned income.

(6)

Certain individuals, etc., not eligible for standard deduction

In the case of—

(A)

a married individual filing a separate return where either spouse itemizes deductions,

(B)

a nonresident alien individual,

(C)

an individual making a return under section 443(a)(1) for a period of less than 12 months on account of a change in his annual accounting period, or

(D)

an estate or trust, common trust fund, or partnership,

the standard deduction shall be zero.

(7)

Special rules for taxable years 2018 through 2025

In the case of a taxable year beginning after December 31, 2017, and before January 1, 2026—

(A)

Increase in standard deduction

Paragraph (2) shall be applied—

(i)

by substituting “$18,000” for “$4,400” in subparagraph (B), and

(ii)

by substituting “$12,000” for “$3,000” in subparagraph (C).

(B)

Adjustment for inflation

(i)

In general

(ii)

Adjustment of increased amounts

In the case of a taxable year beginning after 2018, the $18,000 and $12,000 amounts in subparagraph (A) shall each be increased by an amount equal to—

(I)

such dollar amount, multiplied by

(II)

the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting “2017” for “2016” in subparagraph (A)(ii) thereof.

If any increase under this clause is not a multiple of $50, such increase shall be rounded to the next lowest multiple of $50.

(d)

Itemized deductions

For purposes of this subtitle, the term “itemized deductions” means the deductions allowable under this chapter other than—

(1)

the deductions allowable in arriving at adjusted gross income, and

(2)

any deduction referred to in any paragraph of subsection (b).

(e)

Election to itemize

(1)

In general

(2)

Time and manner of election

(3)

Change of election

Under regulations prescribed by the Secretary, a change of election with respect to itemized deductions for any taxable year may be made after the filing of the return for such year. If the spouse of the taxpayer filed a separate return for any taxable year corresponding to the taxable year of the taxpayer, the change shall not be allowed unless, in accordance with such regulations—

(A)

the spouse makes a change of election with respect to itemized deductions, for the taxable year covered in such separate return, consistent with the change of treatment sought by the taxpayer, and

(B)

the taxpayer and his spouse consent in writing to the assessment (within such period as may be agreed on with the Secretary) of any deficiency, to the extent attributable to such change of election, even though at the time of the filing of such consent the assessment of such deficiency would otherwise be prevented by the operation of any law or rule of law.

This paragraph shall not apply if the tax liability of the taxpayer’s spouse for the taxable year corresponding to the taxable year of the taxpayer has been compromised under section 7122.

(f)

Aged or blind additional amounts

(1)

Additional amounts for the aged

The taxpayer shall be entitled to an additional amount of $600—

(A)

for himself if he has attained age 65 before the close of his taxable year, and

(B)

for the spouse of the taxpayer if the spouse has attained age 65 before the close of the taxable year and an additional exemption is allowable to the taxpayer for such spouse under section 151(b).

(2)

Additional amount for blind

The taxpayer shall be entitled to an additional amount of $600—

(A)

for himself if he is blind at the close of the taxable year, and

(B)

for the spouse of the taxpayer if the spouse is blind as of the close of the taxable year and an additional exemption is allowable to the taxpayer for such spouse under section 151(b).

For purposes of subparagraph (B), if the spouse dies during the taxable year the determination of whether such spouse is blind shall be made as of the time of such death.

(3)

Higher amount for certain unmarried individuals

(4)

Blindness defined

(g)

Marital status

(Aug. 16, 1954, ch. 736, 68A Stat. 18; Pub. L. 95–30, title I, § 102(a), May 23, 1977, 91 Stat. 135; Pub. L. 95–600, title I, § 101(b), Nov. 6, 1978, 92 Stat. 2769; Pub. L. 97–34, title I, §§ 104(b), 111(b)(4), 121(b), (c)(2), Aug. 13, 1981, 95 Stat. 189, 194, 196, 197; Pub. L. 99–514, title I, § 102(a), title XII, § 1272(d)(6), Oct. 22, 1986, 100 Stat. 2099, 2594; Pub. L. 100–647, title I, § 1001(b)(1), Nov. 10, 1988, 102 Stat. 3349; Pub. L. 101–508, title XI, §§ 11101(d)(1)(D), 11801(a)(4), Nov. 5, 1990, 104 Stat. 1388–405, 1388–520; Pub. L. 103–66, title XIII, § 13201(b)(3)(D), Aug. 10, 1993, 107 Stat. 459; Pub. L. 105–34, title XII, § 1201(a), Aug. 5, 1997, 111 Stat. 993; Pub. L. 107–16, title III, § 301(a), (b), (c)(2), June 7, 2001, 115 Stat. 53, 54; Pub. L. 107–147, title IV, § 411(e), Mar. 9, 2002, 116 Stat. 46; Pub. L. 108–27, title I, § 103(a), May 28, 2003, 117 Stat. 754; Pub. L. 108–311, title I, § 101(b), Oct. 4, 2004, 118 Stat. 1167; Pub. L. 110–289, div. C, title I, § 3012(a), (b), July 30, 2008, 122 Stat. 2891, 2892; Pub. L. 110–343, div. C, title II, § 204(a), title VII, § 706(b)(1), (2), Oct. 3, 2008, 122 Stat. 3865, 3922; Pub. L. 111–5, div. B, title I, § 1008(c), Feb. 17, 2009, 123 Stat. 318; Pub. L. 113–295, div. A, title II, § 221(a)(13), Dec. 19, 2014, 128 Stat. 4039; Pub. L. 115–97, title I, §§ 11002(d)(1)(K), 11011(b)(2), (3), 11021(a), Dec. 22, 2017, 131 Stat. 2060, 2070, 2072; Pub. L. 115–141, div. T, § 101(a)(2)(A), Mar. 23, 2018, 132 Stat. 1155; Pub. L. 116–260, div. EE, title II, § 212(b), Dec. 27, 2020, 134 Stat. 3067.)

cite as: 26 USC 63