4 of the Biggest Tax Breaks for Single Americans

Sometimes filing taxes as a single person can feel like cooking for one: not a lot of easy savings. But there are still some good tax breaks for single people.

Let's look at a few tax strategies that single filers can use to reduce their federal income tax bill.

1. 401(k) contributions

If you qualify for a 401(k) or other employer-based retirement savings plan like a 457 or 403(b) account, be sure to put money into it! Saving for retirement is always a good idea, and by putting money into a tax-deferred retirement account, you will also get an immediate tax break.

401(k) contributions aren't technically "tax deductions," because the money just doesn't appear as taxable income on your tax return. But by putting money into your 401(k) or other employer-based plan, you are effectively reducing your income that can be taxed by the IRS.

For example, if you earn a salary of $60,000 per year and you contribute 10% of that salary ($6,000) to your 401(k), your gross income for tax purposes is now only $54,000. Assuming that you're in the 12% tax bracket, a $6,000 401(k) contribution saves you about $720 in income taxes.

For 2024, you can contribute up to $23,000 to a 401(k) or other qualifying retirement plan; people who are age 50 and over can put in a catch-up contribution of an additional $7,500, for a total of $30,500. If you're a high-income single taxpayer, maxing out your 401(k) can be one of the best ways to reduce your tax bill.

2. Traditional IRA

Single people are allowed to contribute up to $7,000 for 2024 to a traditional IRA. If your income qualifies, you can deduct that entire $7,000 amount from your taxable income. People who are age 50 and over can make a catch-up contribution of an extra $1,000 to a traditional IRA -- for a total of $8,000.

If you already have a 401(k) or other retirement plan at work, you might not also be able to use a tax-deductible traditional IRA. There are some limits based on income. For example, if you're a single filer, your adjusted gross income (AGI) must be less than $77,000 to be allowed to take a full tax deduction on your traditional IRA contributions for 2024.

Not everyone has room in their budget to put money into a 401(k) and a traditional IRA. But if you're a single person who's trying to supercharge your retirement savings while reducing your tax bill, this is a good way to do it.

3. Health savings account (HSA)

If you have a high-deductible health insurance plan, you might be able to use a health savings account (HSA), a special tax-advantaged account to save money for healthcare costs (and possibly for your future retirement). Single people with health savings accounts can make tax-deductible HSA contributions of up to $4,150 for 2024.

HSAs offer an excellent "extra" income tax break that more single people should try to get. And unlike the traditional IRA, there are no income limits -- even if you're a high earner who doesn't qualify for lots of other tax breaks, you can get a federal tax deduction for every dollar of your HSA contributions.

4. Itemized deductions (greater than $14,600)

If you're a single homeowner, one possible tax advantage is that it might be easier for you to itemize deductions. Itemized tax deductions are a good way for higher-income taxpayers to reduce their taxable income by deducting charitable donations, home mortgage interest, and state and local taxes. However, with the recent increases in the standard deduction since 2018, most taxpayers cannot itemize.

The standard deduction for single filers for 2024 is $14,600. So if you own your home, and pay a mortgage, and live in a state with income taxes, you might be able to itemize. Here's an example of how itemized deductions might look for a single taxpayer.

Rebecca is a single filer who lives in Illinois, a state that charges state income tax. Rebecca owns her home and paid $6,000 of mortgage interest and $5,000 of property taxes; she also paid $4,000 of Illinois state income taxes. Rebecca also made donations to charity of $3,000.

Rebecca's itemized deductions would look like this:

Because Rebecca's itemized deductions add up to more than her (single filer) standard deduction of $14,600 for 2024, she can take itemized deductions instead. And itemizing reduces her taxable income by an extra $3,400.

Bottom line

It's true that married couples filing jointly sometimes get some extra tax advantages, but don't assume that there's no hope of getting tax breaks as a single person. Single people have options for how to handle tax planning. Try to maximize your 401(k) or other tax-advantaged accounts. And don't forget to take itemized deductions -- this is a big tax break that is sometimes easier for single people to get.