7 Tax Deductions That Get You More Money Back in 2026

What does this mean for you?

If your total itemizable deductions exceed $15,000 (single) or $30,000 (married), you should itemize. The most common items to add up: mortgage interest (average $8,500 in 2026), state and local taxes up to $10,000, charitable gifts, and unreimbursed medical expenses above 7.5% of your adjusted gross income. Many people don't realize that if you own a home in a state with even moderate property taxes, you're likely over the threshold.

As of 2026, the IRS standard deduction is $15,000 for single filers and $30,000 for married couples filing jointly (IRS, Revenue Procedure 2025-45). If your total itemizable deductions — mortgage interest, state and local taxes (SALT) capped at $10,000, charitable contributions, and medical expenses exceeding 7.5% of AGI — surpass those thresholds, itemizing will increase your refund. For example, a married couple in Kansas City with a $250,000 mortgage at 6.8% pays roughly $17,000 in interest in the first year. Add $4,000 in property taxes and $3,000 in charitable donations, and they're at $24,000 — still below $30,000. But if they also have $6,000 in medical expenses (above 7.5% of their $80,000 AGI), they add another $1,500, pushing total deductions to $25,500. Still short. However, if they live in a state with income tax, they can include up to $10,000 in SALT, bringing the total to $31,000 — enough to itemize and save roughly $600. The key is to run the numbers. Use the IRS's free Form 1040 Schedule A to calculate your total. For a quick estimate, try Bankrate's itemizing calculator at Bankrate.com.

Your next step: Gather your mortgage interest statement (Form 1098), property tax records, and charitable donation receipts. Add them up. If the total exceeds $15,000 (single) or $30,000 (married), itemize.

In short: Itemizing beats the standard deduction when your qualifying expenses exceed $15,000 or $30,000, saving you an average of $2,300.

To get more money back on taxes, you need to answer four diagnostic questions:

1. Do you own a home with a mortgage? If yes, you likely have mortgage interest and property taxes that push you toward itemizing.
2. Do you have children under 17? If yes, the Child Tax Credit ($2,000 per child in 2026) and the Child and Dependent Care Credit can add thousands to your refund.
3. Do you have high medical expenses? If your out-of-pocket costs exceed 7.5% of your AGI, you can deduct the excess.
4. Are you self-employed or a freelancer? If yes, you can deduct home office expenses, health insurance premiums, and retirement contributions (SEP IRA, Solo 401k).

What if you have bad credit and low income?

If your income is below $73,000 (single) or $103,000 (married), you may qualify for the Earned Income Tax Credit (EITC). In 2026, the maximum EITC is $7,830 for families with three or more children. This is a refundable credit — meaning you get the money even if you owe zero tax. Many low-income filers miss this because they don't file at all. According to the IRS, 20% of eligible taxpayers don't claim the EITC, leaving an average of $2,500 unclaimed per household.

What if you're self-employed?

Self-employed filers have the most opportunities to reduce taxable income. You can deduct the home office (simplified method: $5 per square foot, up to 300 sq ft = $1,500), health insurance premiums (100% of your premium), and retirement contributions (up to $73,500 in a Solo 401k for 2026). You can also deduct business expenses like equipment, software, and mileage. The key is to track everything. Use a tool like QuickBooks Self-Employed or a simple spreadsheet. The IRS allows you to deduct the actual cost of your home office or use the simplified method — whichever gives you a larger deduction.

The 3-Step Tax Maximization Framework: ID → CALC → CLAIM

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Your next step: Answer the four diagnostic questions above. If you answered 'yes' to any, you're likely leaving money on the table. Use the IRS's Free File program to prepare your return for free if your income is under $79,000.

In short: Answer four questions about homeownership, children, medical costs, and self-employment to find your optimal tax strategy.

Red Flag #1: Taking the Standard Deduction When You Should Itemize

As discussed, 40% of eligible homeowners take the standard deduction. If you have a mortgage, property taxes, and charitable donations, you're likely leaving $1,000–$2,000 on the table. The fix: run the numbers. It takes 10 minutes.

Red Flag #2: Missing the Child Tax Credit

The Child Tax Credit is $2,000 per child under 17 in 2026. Up to $1,700 of that is refundable. If you have two children, that's $4,000 off your tax bill. Yet 10% of eligible families don't claim it because they don't know about it or don't file. The fix: if you have a child under 17, claim the credit on Form 8812.

Red Flag #3: Not Claiming the Earned Income Tax Credit (EITC)

The EITC is one of the most powerful credits for low-to-moderate income workers. In 2026, the maximum credit is $7,830 for families with three or more children. But 20% of eligible workers don't claim it. The fix: if your income is below $63,698 (married filing jointly with three children), check your eligibility using the IRS EITC Assistant.

Red Flag #4: Overlooking Education Credits

The American Opportunity Tax Credit (AOTC) gives you up to $2,500 per student for the first four years of college. 40% of the credit is refundable. The Lifetime Learning Credit gives you up to $2,000 per return. Many parents and students miss these because they don't know the difference. The fix: if you or your dependent is in college, claim the AOTC first — it's more generous.

Red Flag #5: Ignoring State-Specific Rules

Some states have their own deductions and credits. For example, California offers a renter's credit of $60–$120. New York has a child and dependent care credit. Texas has no state income tax, but property taxes are high. The fix: check your state's tax agency website.

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Your next step: Review your last year's tax return. Did you claim the Child Tax Credit? The EITC? Did you itemize? If you answered 'no' to any, you likely overpaid. This year, use the IRS Free File program to prepare your return for free.

In short: Most people overpay by missing the Child Tax Credit, EITC, education credits, and by using expensive tax preparers.

The $ Math: Best, Average, and Worst Scenarios Over 5 Years

Best case: A married couple in Kansas City with a $300,000 mortgage, two children, and $10,000 in charitable donations itemizes and claims the Child Tax Credit. They save $3,500/year. Over 5 years: $17,500.

Average case: A single filer with a $200,000 mortgage and $5,000 in charity itemizes and saves $1,200/year. Over 5 years: $6,000.

Worst case: A renter with no children and no medical expenses takes the standard deduction and misses no credits. They save $0 by itemizing, but they didn't lose anything either.

✅ Best for: Homeowners with mortgages over $200,000, parents with children under 17, self-employed individuals, and high-income earners in high-tax states.

❌ Not ideal for: Renters with no dependents and low medical expenses, and anyone who doesn't want to track receipts year-round.

Your next step: Go to IRS Free File and prepare your 2025 return for free. Compare the standard deduction vs. itemizing. Claim every credit you're eligible for. You'll get more money back.

In short: Homeowners, parents, and self-employed filers get the best deal by itemizing and claiming all credits, saving an average of $2,300 per year.