What are above-the-line deductions?
Above-the-line deductions are deductions that you subtract from your gross income to arrive at your adjusted gross income (AGI) and are distinct from other deductions, which are subtracted from AGI.
Above-the-line deductions can be taken by anyone, regardless of whether you choose to take the standard deduction or itemize deductions. Plus they don’t phaseout or cutoff beyond certain income levels.
Above-the-line deductions are generally considered more beneficial than other deductions because lowering your AGI could allow you to qualify for more credits and deductions.
Above-the-line deductions include deductions for
alimony
Archer MSAs and health savings accounts (HSAs)
certain business expenses
clean-fuel vehicles and certain refueling property
jury duty pay
losses from property sales
moving expenses
rents and royalties
retirement savings
self-employed individuals’ pensions, profit-sharing, and annuity plans
student loan interest
tuition and related expenses
Internal Revenue Code Section 62 can provide more specific information on what’s allowed as an above-the-line deduction.
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