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3. The Standard Deduction: When individuals have minimal below-the-line deductions, they are directly granted a standard deduction. The standard deduction under different heads in 2004 was as follows: i) Single $4,850ii) Head of household $7,150 iii) Married filing a joint return $9,700 iv) Qualifying widow(er) with dependent child $9,500 v) Married filing a separate return … Continue reading Standard deductions and Itemized deductions

2. Deductions: In addition to the standard deduction, some common above-the-line deductions include:i) Trade/ Business expensesii) Alimonyiii) IRA contributionsiv) Net capital lossesv) Expenses incurred due to property used for income generation Income tax laws are not easy to understand. It is therefore always possible that individuals choosing the standard deduction may or may not be … Continue reading Heads under which you can avail deductions