Form 1040 Schedule A: Itemized Deductions (2015) – A Complete Guide
What Form 1040 Schedule A Is For
Schedule A is an attachment to your Form 1040 that allows you to claim itemized deductions instead of taking the standard deduction. Think of it as a detailed list of eligible expenses that can reduce your taxable income. You'll choose to itemize only if your total qualifying deductions exceed your standard deduction amount—whichever gives you the bigger tax break.
The form covers seven major categories of expenses: medical and dental costs, taxes you paid, interest on home mortgages, charitable contributions, casualty and theft losses, job-related expenses, and other miscellaneous deductions. For 2015, this form became especially valuable for homeowners with mortgages, people with significant medical bills, or those who made substantial charitable donations throughout the year.
The key decision point is simple: compare your potential itemized deductions to your standard deduction. For 2015, standard deductions were $6,300 for single filers, $12,600 for married couples filing jointly, and $9,250 for heads of household. If your itemizable expenses add up to more than these amounts, Schedule A can save you money.
When You'd Use Form 1040 Schedule A (Late/Amended Filing)
Schedule A accompanies your regular Form 1040, which for tax year 2015 was typically due by April 18, 2016 (the deadline was extended from April 15 because that date fell on a weekend and the following Monday was Emancipation Day in Washington, D.C.). If you filed an extension, you had until October 17, 2016 to submit your return.
If you initially took the standard deduction but later realized itemizing would have saved you more money, you can amend your return using Form 1040X. You generally have three years from the original filing deadline to file an amended return claiming a refund. For the 2015 tax year, this meant you had until April 18, 2019 to amend your return.
You might also need to file or amend Schedule A if you received corrected tax documents after filing (such as a revised Form 1098 showing different mortgage interest), discovered you forgot to claim significant deductible expenses, or received a refund of state taxes you'd deducted in a prior year that needs to be reported as income. When amending, attach a statement explaining the changes you're making and include any supporting documentation the IRS might need to process your amendment.
Key Rules or Details for 2015
The 10% and 7.5% Medical Expense Thresholds: You can only deduct medical and dental expenses exceeding 10% of your adjusted gross income (AGI). However, if you or your spouse were born before January 2, 1951, you qualify for the more generous 7.5% threshold. This age-based exception was particularly valuable for older taxpayers with significant healthcare costs.
The AGI Limitation for High Earners: If your AGI exceeded $154,950 in 2015 (for married filing separately; $309,900 for joint filers), your total itemized deductions may be reduced. This phaseout rule, commonly called the ""Pease limitation,"" required high-income taxpayers to use a special worksheet to calculate their allowable deductions. The reduction generally equaled 3% of the amount by which your AGI exceeded the threshold, but you couldn't lose more than 80% of your itemized deductions.
No Double-Dipping: You cannot deduct expenses that were reimbursed by insurance or your employer, paid through pre-tax dollars (like cafeteria plans), or already claimed on another schedule like Schedule C for business expenses. This is one of the most common errors taxpayers make.
State Tax Choice: You must choose between deducting state and local income taxes OR general sales taxes—you cannot claim both. Most people choose income taxes, but those living in states without income tax (like Florida or Texas) could use the IRS sales tax tables to claim sales tax deductions instead.
Mortgage Interest Limits: For mortgages taken out after October 13, 1987, you could generally deduct interest on up to $1 million of acquisition debt (to buy, build, or improve your home) plus $100,000 of home equity debt. These limits were halved for married taxpayers filing separately.
Step-by-Step (High Level)
Step 1: Gather Your Documentation
Collect all relevant receipts, statements, and forms—medical bills and insurance statements, property tax bills, Form 1098 for mortgage interest, charitable contribution receipts, and any other proof of deductible expenses. Good recordkeeping is essential because you'll need these documents if the IRS questions your deductions.
Step 2: Calculate Each Category
Work through Schedule A line by line. For medical expenses, subtract 10% (or 7.5% if age-qualified) of your AGI from your total unreimbursed costs. For taxes, add up your deductible state/local income taxes (or sales taxes), real estate taxes, and personal property taxes. Include all home mortgage interest from Forms 1098, plus any additional qualified mortgage interest. List cash and non-cash charitable contributions, making sure you have proper documentation. Add any casualty losses, job expenses, and miscellaneous deductions.
Step 3: Apply the 2% Floor for Miscellaneous Deductions
Certain expenses like unreimbursed employee costs, tax preparation fees, and investment expenses are only deductible to the extent they exceed 2% of your AGI. Calculate your AGI threshold and subtract it from your total miscellaneous expenses.
Step 4: Total Everything and Compare
Add up all your itemized deductions. If your AGI exceeds $154,950 (for married filing separately), complete the Itemized Deductions Worksheet to see if your deductions must be reduced. Compare your final itemized total to your standard deduction—claim whichever is larger.
Step 5: Transfer to Form 1040
Enter your total itemized deductions on Form 1040, line 40, and attach Schedule A to your return. Make sure to check any required boxes (like the age box if you're using the 7.5% medical threshold) to avoid processing delays.
Common Mistakes and How to Avoid Them
Forgetting the AGI Threshold for Medical Expenses: Many taxpayers mistakenly deduct their entire medical bill instead of only the amount exceeding 10% (or 7.5%) of AGI. Always calculate your threshold first—if your AGI was $50,000 and you're under the 10% rule, you'd need more than $5,000 in medical expenses to claim any deduction at all.
Including Reimbursed Expenses: Only unreimbursed expenses are deductible. If your insurance paid $3,000 of a $5,000 surgery, you can only count the $2,000 you paid out-of-pocket. Similarly, don't include medical insurance premiums already deducted as self-employed health insurance on Form 1040, line 29, or premiums paid through employer cafeteria plans with pre-tax dollars.
Deducting Non-Deductible ""Taxes"": Not every payment to government is a deductible tax. You cannot deduct federal income taxes, social security and Medicare taxes, most vehicle registration fees (unless specifically based on value), or special assessments for local improvements that increase property value like a new sidewalk. Look carefully at your real estate tax bill to separate deductible taxes from non-deductible charges for services.
Missing Documentation for Charitable Gifts: For any donation of $250 or more, you must have written acknowledgment from the charity obtained by your filing deadline. For cash donations of any amount, you need a bank record or receipt. Many taxpayers lose these deductions simply because they can't produce the required paperwork. Set up a system to save these documents as you receive them throughout the year.
Confusing Refunds and Prior-Year Deductions: If you received a state tax refund in 2015 for taxes you paid in 2015, reduce your 2015 deduction by that amount. However, if you received a 2015 refund for taxes you deducted in a prior year, don't reduce your current deduction—instead, you may need to report the refund as income on Form 1040, line 21, if the prior deduction reduced your tax.
Exceeding Mortgage Interest Limits Without Checking: If you had large mortgages or home equity loans, don't assume all your interest is deductible. The $1 million/$100,000 limits could restrict your deduction, especially if you refinanced or had multiple properties. Publication 936 contains worksheets to help you calculate the deductible portion.
What Happens After You File
Once you submit your return with Schedule A attached, the IRS processes it like any other tax return. Your itemized deductions reduce your taxable income, potentially lowering your tax bill or increasing your refund. The IRS computers check for mathematical errors and obvious discrepancies, but your return won't necessarily be examined in detail unless it's selected for audit.
Keep Your Records: Don't throw away your supporting documents after filing. The IRS requires you to maintain receipts, cancelled checks, Form 1098s, charitable acknowledgment letters, and all other proof of your deductions for at least three years from your filing date (or two years from when you paid the tax, whichever is later). In some cases involving substantial errors or fraud, the IRS can look back even further.
Audit Possibility: While most returns aren't audited, certain factors increase scrutiny—very large charitable deductions relative to income, significant miscellaneous deductions, or casualty losses. If selected for audit, you'll receive a notice by mail asking you to substantiate specific deductions. Having organized records makes this process much less stressful.
Future Year Impact: If you deducted state income taxes on your 2015 Schedule A, any refund you receive in 2016 for those taxes might be taxable income on your 2016 return (if the deduction reduced your 2015 tax). You'll receive Form 1099-G showing the refund amount. Similarly, if you overpaid mortgage interest or property taxes that get refunded, you might need to report that refund as income in the year received.
Processing Your Refund or Payment: Your itemized deductions are factored into your overall tax calculation. If you're due a refund, expect it within 21 days if you e-filed, or six weeks if you mailed a paper return. If you owe taxes, your payment deadline doesn't change—April 18, 2016 for most taxpayers, regardless of whether you itemize.
FAQs
Should I itemize or take the standard deduction?
Calculate both and choose whichever gives you the larger deduction. As a general rule, you'll benefit from itemizing if you're a homeowner with a mortgage, had significant medical expenses, made substantial charitable donations, or paid high state and local taxes. Single renters without major deductible expenses usually find the standard deduction more beneficial.
Can married couples file separately and one itemize while the other takes the standard deduction?
No. If you're married filing separately, you must both itemize or both take the standard deduction. This is one reason why married filing separately is often disadvantageous from a tax perspective.
What if I can't find my Form 1098 showing mortgage interest?
Contact your mortgage lender and request a duplicate. Most lenders can provide this electronically or by mail. Don't guess at the amount—you need accurate figures, and the IRS receives copies of all Forms 1098, so they can easily verify what you claim.
Are cosmetic surgery and teeth whitening deductible medical expenses?
Generally no. Cosmetic procedures that aren't medically necessary (like elective plastic surgery or teeth whitening for appearance) don't qualify. However, surgery to correct a deformity from an accident, injury, or disease is deductible. Necessary dental work like fillings, crowns, and dentures qualifies, even though they improve appearance.
How do I know if my state tax refund is taxable income?
If you itemized deductions in the prior year and those itemized deductions reduced your federal tax (meaning itemizing saved you money over the standard deduction), then your state refund is taxable to the extent your deduction reduced your tax. If you took the standard deduction in the prior year, your state refund isn't taxable. The IRS provides a worksheet in the Form 1040 instructions to calculate the taxable portion.
Can I deduct mileage for medical appointments?
Yes. For 2015, you could deduct 23 cents per mile driven for medical purposes, plus parking fees and tolls. Alternatively, you can deduct actual out-of-pocket costs for gas and oil (but not general car maintenance or depreciation). Keep a log of dates, destinations, and miles driven to support your deduction.
What happens if I make a mistake on my Schedule A?
If you catch the error before filing, simply correct it on your form. If you've already filed and the error cost you money (you paid too much tax or received too small a refund), file Form 1040X to amend your return. If the error benefited you (you paid too little), you should still file an amended return to avoid potential penalties and interest. The IRS may also catch mathematical errors and correct them automatically, sending you an explanation of the change.
Sources: All information is based on official IRS publications for tax year 2015, including Form 1040 Schedule A and the Instructions for Schedule A.
