The President has signed the biggest tax reform law in over 30 years. When you file your 2018 return -about a year from now- your return will look very different. Here are a few of the changes that might affect you:

  • Tax rate changes: Most of the individual tax bracket tax rates have been reduced and the corporate rate is now a flat 21%.
  • Standard deduction increases: The standard deduction almost doubles. However, there are no more personal exemption deductions. This may help you or hurt you.
  • Increased child tax credit: the credit is increased from $1,000 to $2,000 per child.
  • New dependent credit: A non-child dependent can receive a new credit of $500.

Disappearing Deductions:

Beginning with 2018 you will no longer be able to deduct:

  • Property tax and state income tax above $10,000.
  • Moving expenses.
  • Unreimbursed employee expenses (such as, union dues, travel, etc.).
  • Mortgage interest beyond interest on $750,000 of acquisition debt, if you purchase a new home.
  • Mortgage interest paid on equity debt.
  • Personal and dependency exemptions.

Some new benefits for individuals:

  • Medical expense:Medical expense AGI threshold will temporarily drop to 7.5% for 2017 and 2018.
  • AMT: Alternative minimum tax threshold is increased, so fewer middle-income taxpayers will be subject to it.
  • Estate tax: The estate tax exclusion has nearly doubled.

New for 2018