The new tax law nearly doubles the standard deduction for taxpayers. Standard deductions are increased to $24,000 for married filing joint filers, $12,000 for single filers, and $18,000 for head of household filers. All personal exemptions are eliminated.

 

Most job-related moving expenses are no longer deductible. Employee business expenses, brokerage and IRA fees, tax preparation costs, and theft losses are all eliminated.

 

Alimony for post 2018 divorce decrees is not taxable to the recipient, nor deductible by the payer.

 

There will no longer be the sneaky tax hike caused by the phase out of itemized deductions. This provision in the tax code has been eliminated.

 

Taxes are reduced by both lower rates and higher income levels for rate increases.

 

The requirement that taxpayers have health insurance, qualify for an exemption, or pay a fine is repealed for post 2018 years.

 

The child tax credit is doubled to $2,000 for each dependent under age 17. There’s a new $500 credit for each dependent who is not a qualifying child.

 

529 college savings plans are enhanced to allow annual distributions of up to $10,000 per student to pay tuition for elementary and secondary education.

 

David M. Snyder, CPA

The Tax Axe, LLC

May 2018