Standard Deduction

Under federal and Oklahoma tax law, the standard deduction is a dollar amount that taxpayers who do not claim itemized deductions may subtract from their income before income tax is applied. Taxpayers may choose either itemized deductions or the standard deduction, but usually choose whichever results in the lesser amount of tax payable. Under the Tax Cuts and Jobs Act of 2017, the federal standard deduction was nearly doubled, while the personal exemption was eliminated. The federal standard deduction usually increases annually to account for inflation.

Until the mid-2000s, Oklahoma’s standard deduction had long been frozen at just $1,000 for a single individual and $2,000 for a married couple. Under legislation enacted in 2005, Oklahoma’s standard deduction was increased over several years and then was coupled to the federal standard deduction as of 2010. However, in 2017, after Congress passed tax legislation that doubled the standard deduction, the Legislature passed HB 2348 that froze the standard deduction at 2017 federal levels in perpetuity: $6,350 for a single taxpayer or a married couple filing separate, $9,350 for a head of household, and $12,700 for a married couple filing jointly.

In 2022, 1,701,6590 taxpayers – or 91 percent of all households – claimed the standard deduction in Oklahoma in amounts totaling $559.2 million, according to the 2023-4 Tax Expenditure Report.