In 2008, the amount taxpayers can deduct for each exemption increased from $3,400 to $3,500. (Exemptions are covered in more detail in the Personal and Dependency Exemptions lesson.)

The standard deduction (for taxpayers who do not itemize deductions on Form 1040, Schedule A) is higher in 2008 than it was in 2007.

For 2008, taxpayers who file using the standard deduction will be entitled to an additional standard deduction for state and local real property taxes.