Standard vs Itemized Deduction for 2025 Returns
The Tax Cuts and Jobs Act nearly doubled the standard deduction and capped state and local tax deductions, pushing most filers away from itemizing. Here's when itemizing still makes sense.
2025 standard deduction amounts
Single or married filing separately: $15,000.
Married filing jointly: $30,000.
Head of household: $22,500.
Additional for age 65+ or blind: $1,600 (married) / $2,000 (single).
The itemized deductions that survive
State and local taxes (SALT) — capped at $10,000 total (state income tax + property tax combined).
Home mortgage interest on up to $750,000 of mortgage debt ($1M grandfathered for pre-2018 loans).
Charitable contributions.
Medical expenses over 7.5% of AGI.
Casualty losses in federally declared disaster areas.
When itemizing wins in Montana
Homeowners with a mortgage over ~$300k, some property tax, and any charitable giving usually cross the standard deduction.
Married joint filers need to clear $30k of itemized deductions — a high bar. Single filers only need $15k.
Big medical years (surgery, long-term care) can push a filer to itemize in a specific year.
The bunching strategy
If you're close to the standard deduction threshold, bunch charitable giving into every other year — give two years' worth in one calendar year, then take the standard deduction the next.
Donor-advised funds make this clean: contribute a large amount in Year 1 (deduct it), then distribute to charities over Years 1–3.
Montana state — separate calculation
Montana lets you itemize on the state return even if you take the federal standard deduction (or vice versa).
Because Montana's standard deduction is lower, itemizing on Montana while taking federal standard is a real strategy for many taxpayers.
A quick disclaimer
This article is general information for Montana small business owners, not tax, legal, or accounting advice for your specific situation. Rules change, and how they apply depends on facts we don't know about you. Before acting on anything you read here, talk to a qualified professional. If you're a Montana business owner and want a real conversation about your books, payroll, or tax, that's what Marlow Accounting is here for — call 406-290-1214 or schedule a discovery call.