Peaceful Divorce

Have you thought about doing a tax projection for 2018?

Obviously, this isn’t everyone’s cup of tea. However, no one wants to be surprised around tax time. Here’s why you should get a head start on knowing the new tax law and how it will affect you and/or your business in the coming tax year.

We are seven months into the New Year. You may not be aware that we have a new tax law that went into effect on December 22, 2017, or that most of the provisions took effect on January 1, 2018.

Here are some highlights of this new tax law and how it may affect you or your business:

  • There are lower tax rates for individuals costing the taxpayer less in the long run.
  • Standard deductions have doubled which means you can deduct more from your taxes, giving yourself a larger refund this year.
  • Personal exemptions are repealed which means you will not have the deduction for the personal exemption anymore.  
  • Many deductions on Schedule A have been deleted. You may need to take a look at the receipts you’ve saved and consider if they are still worth saving or just taking up room in your filing cabinet.
  • The Alternative minimum tax is still here, but exemption amounts and thresholds for phasing out are increased.
  • The Child Tax Credit is doubled from $1,000 per child to $2,000 per child. Also, a major plus is that the phase-out for high-income earners has increased.
  • The state, local, and real estate taxes are now limited to $10,000 in total. Finally, the mortgage interest deduction has changed you need to be aware of this.

This is important if you were divorced in 2017 or going to be divorced in 2018.  You might have been calculation your taxes under the old tax rates.

These are just some of the points of interest that may affect you, the taxpayer. It is better to know what your taxes will be for the end of the year. Therefore, it is time to contact your CPA or local tax professional and consider your tax protections. They have fully studied up on this new law and will be more than happy to help you when filing your taxes.

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