With strategic planning, Americans can reduce their tax liability via tax deductions and credits. Common deductions include qualified mortgage interest payments, student loan interest, property taxes and other expenses. Taxpayers have the option to itemize deductions above and beyond the standard tax deduction. For the 2023 tax year, the standard deduction is $13,850 for individuals and $27,700 for joint filers.
SmartAsset used the latest IRS data available to evaluate where Americans write off the most in taxes by measuring the average itemized deduction amount and the percentage of returns opting to itemize.
Using the most recently available IRS tax data from 2021, states were ranked by the size of itemized deductions averaged across taxpayers. Total tax liability paid was also compared with the total adjusted gross income for the state, as well as the percentage of returns electing to itemize their deductions.
This story was produced by SmartAsset and reviewed and distributed by Stacker Media.