I’m sure by now you’ve heard someone complain about their tax refund. Here are a few major changes to the federal tax code that may affect your 2018 returns.

7 Important Deductions Going Away

  1. Dependent and personal exemptions

  2. Interest on Home Equity loans not used to build, buy or improve your home

  3. Mortgage Insurance Premiums (MIP)

  4. Exclusion for forgiven debt

  5. Miscellaneous itemized deductions – i.e. unreimbursed employee expenses

  6. Moving expenses

  7. Tax preparation and investment fees

New Deduction Rules

Taxpayers who itemize their deductions can only deduct up to $10,000 on a combination of the following:

  • State income taxes

  • Sales tax

  • Local taxes

  • Property tax (If you pay high property taxes you will feel these effects more. This is common in states like California and New York.)

Standard Deductions

SINGLE: In 2017 $6,350 — In 2018, $12,000
MARRIED: In 2017 $12,700 — In 2018, $24,000
HEAD OF HOUSEHOLD: In 2017 $9,350 — In 2018, $18,000

The Child Tax Credit

The per child credit in 2017 was $1,000, that has been increased to $2,000 for 2018.

Important Dates

Tax Day Deadline – April 15th

Some USPS locations will be open late to postmark your tax return. Approved Post Providers do not offer late postmarking, so verify their last collection hours. If you file electronically, file no later than 11:59 pm.

Paycheck Check-up – July

In July, ensure your withholdings are up to date and adjust if necessary.

Extension Deadline – October 15th

This is the last day to file your tax return if you received an extension from the IRS. Need more help making sense of it all? Consider using a tax professional. 20% of income tax returns prepared on paper have mistakes, which can lead to overpaying taxes or penalties. If you don’t have one yet, call me for a great referral!

All information is general in nature and should be taken as legal advice or guaranteed. Readers should not rely solely on this information. Contact a tax professional for more context on the tax law changes. Sources: IRS & USPS

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