2027 Standard Deduction Increases: How Much Can You Deduct?

The IRS has announced higher standard deduction amounts for the 2027 tax year. These increases could reduce taxable income for millions of Americans, including individuals and families living in South Florida.

The standard deduction is one of the most important components of a federal income tax return because it reduces the amount of income subject to federal taxation.

What is the standard deduction for 2027?

The IRS has confirmed the following amounts:

For married couples filing jointly, the standard deduction increases by $1,000 compared with 2026.

How does the standard deduction reduce taxes?

Consider a married couple with $150,000 in adjusted gross income and no other deductions affecting taxable income.

If they qualify for the $33,200 standard deduction in 2027, their taxable income would generally be reduced to $116,800 before considering other applicable tax provisions.

The deduction does not represent a direct refund. Instead, it reduces the income used to calculate federal tax liability.

Should Florida homeowners itemize deductions?

That depends on their financial circumstances.

Many homeowners in Broward and Miami-Dade counties pay substantial property taxes and mortgage interest. When combined with charitable contributions and other eligible expenses, their itemized deductions may exceed the standard deduction.

However, federal limitations on certain deductions must also be considered.

Taxpayers should compare both approaches before filing rather than assuming itemizing is automatically better.

What about retirees and taxpayers over 65?

Certain taxpayers age 65 or older may qualify for an additional standard deduction under existing law.

There is also a separate enhanced senior deduction available for qualifying taxpayers during tax years 2025 through 2028. Eligibility and income limitations apply.

These provisions are different, so taxpayers should review them separately.

What should South Florida taxpayers do?

The increased standard deduction provides an opportunity to review tax strategies before 2027.

For example, taxpayers may want to evaluate whether grouping charitable contributions into a particular year, adjusting retirement distributions, or timing deductible expenses could improve their overall tax position.

James Ridout CPA provides individualized federal tax planning for Florida residents, business owners, retirees, and investors. Contact the firm to discuss your 2027 tax strategy.