itemized deduction investment & finance definition

A deduction that is taken off of federal income taxes by totaling individual expenses such as charitable expenses, mortgage interest expense, and health care expenses, which are deducted on Schedule A. These expenses have to be greater than 2% of the taxpayers adjusted gross income in order to be deducted. An itemized deduction contrasts with a standard deduction, which is an amount that can be deducted by every taxpayer filing in that particular category.