What "tax deduction" means in finance

A tax deduction is a reduction in taxable income that lowers the amount of tax an individual or business is required to pay. Tax deductions are usually expenses that are considered necessary for the operation of a business or for the production of income. Examples of tax deductions include business expenses, mortgage interest payments, charitable donations, and certain medical expenses. The amount of the deduction depends on the tax code and can vary from country to country.