Increase in standard deduction. The standard deduction for taxpayers who do not itemize deductions on Schedule A of Form 1040 is higher in 1998 than it was in 1997. The amount depends upon your filing status. 1998 Standard Deduction Tables are shown at the end of this chapter.

Standard deduction for dependents. The minimum standard deduction for dependents has increased from $650 for 1997 to $700 for 1998. Also, the standard deduction for many dependents with earned income has increased. Table 21-3 is used to figure this deduction.

Itemized deductions. The amount you can deduct for itemized deductions is limited if your adjusted gross income is more than $124,500 ($62,250 if you are married filing separately). See chapter 22 for more information.

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