What the Form Is For

Schedule A (Form 1040) is the form you use to claim itemized deductions — specific expenses that you can subtract from your adjusted gross income (AGI) to reduce your taxable income. Think of it as an alternative to taking the standard deduction that everyone automatically gets.

The form lets you deduct certain out-of-pocket expenses you paid during 2016, including medical and dental costs, state and local taxes, home mortgage interest, charitable donations, and various other qualified expenses. You attach Schedule A to your main Form 1040 when you file your taxes.

The key decision: You'll want to itemize only if your total itemized deductions exceed your standard deduction.

For 2016, the standard deductions were:

• $6,300 for single filers
• $12,600 for married couples filing jointly
• $9,300 for heads of household

If your itemizable expenses don't exceed these amounts, take the standard deduction — it’s simpler and saves time.

When You’d Use It (Late or Amended Filings)

Filing Deadlines

For original 2016 returns, Schedule A should have been filed by April 18, 2017 (the regular filing deadline for 2016).

If you never filed your 2016 return, you can still do so. Penalties and interest may apply if you owed taxes, but if you were owed a refund, you had until April 18, 2020 to claim it.

Amending Your 2016 Return

If you already filed but realized you should have itemized deductions (or vice versa), you could file Form 1040-X (Amended U.S. Individual Income Tax Return) with a corrected Schedule A attached — also by April 18, 2020.

You don’t need to amend for math errors; the IRS corrects those automatically. Amend only for changes to filing status, dependents, income, or deductions/credits.

Key Rules for 2016

Several thresholds and limits applied to Schedule A deductions for 2016.

Medical and Dental Expenses

• Deduct only the portion exceeding 10% of AGI, or 7.5% if age 65+ (born before January 2, 1952).
• Many taxpayers couldn’t claim this deduction due to the high threshold.

State and Local Taxes

• You could deduct either state/local income taxes or general sales taxes — not both.
• Most taxpayers chose income taxes unless they lived in a no-income-tax state.

Home Mortgage Interest

• Interest was deductible on up to $1 million of acquisition debt ($500,000 if married filing separately).
• Also deductible: up to $100,000 of home equity debt ($50,000 if married filing separately).
• Applies to mortgages taken after October 13, 1987.

Charitable Contributions

• Generally limited to 50% of AGI for cash donations to public charities.
• Other types of donations had lower limits.

Miscellaneous Deductions

• Unreimbursed employee and investment expenses were deductible only if they exceeded 2% of AGI.
• These deductions were eliminated for tax years 2018–2025 under later law changes.

Overall Limit on Itemized Deductions

• If your AGI exceeded $155,650, your total itemized deductions were subject to a phase-out reduction, limiting high-income taxpayers’ benefits.

Step-by-Step Overview (High Level)

Here’s how to complete Schedule A step by step:

Step 1: Gather Your Documentation

Collect all receipts, statements, and records — medical bills, mortgage interest (Form 1098), property taxes, and charitable receipts.

Step 2: Medical and Dental Expenses (Lines 1–4)

Add up all unreimbursed medical and dental costs, apply your AGI threshold (10% or 7.5%), and deduct only the excess.

Step 3: Taxes You Paid (Lines 5–9)

Choose to deduct either income or sales taxes, then add real estate and personal property taxes.

Step 4: Interest You Paid (Lines 10–15)

Report deductible mortgage and investment interest as shown on Form 1098.

Step 5: Gifts to Charity (Lines 16–19)

List all charitable contributions — cash, property, and any carryovers from previous years.

Step 6: Casualty and Theft Losses (Line 20)

Report losses from federally declared disasters using Form 4684.

Step 7: Miscellaneous Deductions (Lines 21–28)

Include unreimbursed employee expenses, tax prep fees, and investment costs (subject to the 2% AGI limit).

Step 8: Total and Apply Phase-Out (Line 29)

Add all deductions and apply the reduction if your AGI exceeded $155,650.

Step 9: Compare to Standard Deduction

Transfer your total to Form 1040, Line 40 only if it’s larger than your standard deduction.

Common Mistakes and How to Avoid Them

Mistake #1: Claiming Reimbursed Expenses

You can’t deduct expenses already reimbursed by insurance or your employer.
Avoid it: Subtract reimbursements before calculating deductions.

Mistake #2: Deducting Both Income and Sales Taxes

Schedule A allows only one — either income or sales tax.
Avoid it: Check only one box (5a or 5b).

Mistake #3: Ignoring AGI Thresholds

Some expenses apply only above 10% or 2% of AGI.
Avoid it: Multiply your AGI by the threshold before claiming.

Mistake #4: Lacking Documentation

Receipts, checks, or acknowledgments are required, especially for donations over $250.
Avoid it: Keep organized records for at least three (preferably seven) years.

Mistake #5: Forgetting the Overall Limitation

High-income filers often overlook the itemized deduction phase-out.
Avoid it: Follow the worksheet in the Schedule A instructions.

Mistake #6: Including Non-Deductible Items

Items like federal taxes, life insurance premiums, or personal interest aren’t deductible.
Avoid it: Review IRS Publications 502, 530, and 936 before filing.

What Happens After You File

IRS Processing (6–8 Weeks)

The IRS reviews and processes your return, correcting simple math errors automatically.

Refund or Balance Due

Expect a refund within 21 days (e-file) or 6–8 weeks (paper). Pay any balance promptly to avoid penalties and interest.

Audit Selection

Itemized deductions are common audit triggers. Large donations or medical expenses may attract attention.
Less than 1% of individual returns are audited overall, but higher incomes face greater scrutiny.

If You’re Selected for Audit

The IRS will notify you by mail only. Most are correspondence audits conducted by mail.
You’ll have 30 days to respond with documentation. If the IRS proposes changes, you’ll receive a 30-Day Letter with appeal rights.

Statute of Limitations

The IRS generally has three years from your filing date to audit or assess more taxes (six years if substantial errors are found).
Keep all records for at least three years — seven is safer.

FAQs

Q1: Can I itemize if my spouse takes the standard deduction?

No. If you’re married filing separately and your spouse itemizes, you must itemize too — even if it’s less beneficial.

Q2: What if I don’t have receipts for all expenses?

You must keep proof for all deductions.
For amounts under $75, credit card or bank records may suffice, but donations over $250 require written acknowledgment.

Q3: Is it worth itemizing if I barely exceed the standard deduction?

It depends. If the savings are small, take the standard deduction for simplicity — but double-check you’ve included all eligible deductions.

Q4: Can I deduct expenses charged in December 2016 but paid later?

Yes. If you charged the expense in 2016, it’s deductible for 2016 — even if you paid the bill in 2017.

Q5: I took the standard deduction but now realize I should have itemized. Can I fix this?

The amendment deadline (April 18, 2020) has passed, so you can no longer change your 2016 return.

Q6: Are mortgage points deductible in full?

Usually yes, for points paid to buy or improve your main home — if requirements are met.
Refinancing points must be amortized over the loan’s term (see Publication 936).

Q7: Are all property tax charges deductible?

No. Only ad valorem taxes based on property value are deductible. Fees for trash, sewer, or utilities are not.

Additional Resources

• IRS Schedule A Instructions (2016)
• IRS Publication 502: Medical and Dental Expenses (2016)
• IRS Publication 936: Home Mortgage Interest Deduction
• IRS Topic 501: Should I Itemize?

Note: This summary is for educational purposes and based on 2016 tax law. Tax laws change frequently; always consult official IRS instructions or a qualified tax professional.