{"id":88,"date":"2018-12-10T19:29:54","date_gmt":"2018-12-10T19:29:54","guid":{"rendered":"https:\/\/www.mckaytax.com\/blog\/?p=88"},"modified":"2019-02-20T01:11:33","modified_gmt":"2019-02-20T01:11:33","slug":"2018-tax-changes-announcement","status":"publish","type":"post","link":"https:\/\/www.mckaytax.com\/blog\/2018-tax-changes-announcement\/","title":{"rendered":"2018 Tax Changes Announcement"},"content":{"rendered":"

It’s that time of year again!  Tax season.<\/p>\n

We talked a little bit about this in last year’s newsletter.  But here is a reminder —<\/p>\n

The Tax Cuts and Jobs Act of 2017 brought on the biggest changes in tax law history.  Overall, new deductions have been added and some old, common deductions have been completely repealed.<\/p>\n

Below, I will highlight some of the big changes for the 2018 tax year — both for Individuals and for Businesses. Please give me a call if you have questions.<\/p>\n

<\/p>\n

FOR INDIVIDUALS<\/h2>\n
    \n
  1. Most tax rates are lowered.  For example, rates of 15% changed to 12%, 25% to 22% and 28% to 24%.<\/li>\n
  2. The standard deduction almost doubles from 2017. For single filers, the standard deduction increases to $12,000 from $6,350 currently; for married couples filing jointly, it increases to $24,000 from $12,700.<\/li>\n
  3. The personal exemptions have been eliminated for 2018.<\/li>\n
  4. 2% miscellaneous itemized deductions like employee business expenses (meal, business miles, etc.), investment fees, tax preparation fees, etc. have been eliminated.  This is as an individual.  Sole proprietors, Corporations, and Partnerships can still deduct all ordinary and reasonable business expenses.<\/li>\n
  5. The State and local tax deductions are now capped at $10,000.<\/li>\n
  6. The child tax credit is doubled to $2,000 for children under the age of 17.  This child tax credit is also available to high earners. The income threshold under which filers may claim the full credit is $200,000 for single parents, up from $75,000; and to $400,000 for married couples, up from $110,000.<\/li>\n
  7. A credit for non-child dependents is added.  This bill allows parents to take a $500 credit for each non-child dependent whom they are supporting such as a child older than the age of 17, an ailing, elderly parent, or a disabled adult child.<\/li>\n
  8. If you take out a new mortgage on a first or second<\/em> home you will only be allowed to deduct the interest on debt up to $750,000, down from $1 million in 2017. Homeowners who already had a mortgage in place are unaffected by the change. Interest on home equity loans is no longer deductible.<\/li>\n
  9. Elementary and secondary schools tuition can now be paid for with 529 Education Savings Plans.<\/li>\n
  10. For those without insurance, The Affordable Care Penalty will apply for 2018 but will not apply in 2019 and forward.<\/li>\n<\/ol>\n

    FOR BUSINESSES AND CORPORATIONS<\/h2>\n
      \n
    1. Owners, partners, and shareholders of S-corporations, LLCs, or partnerships who pay their share of the business’ taxes through their individual tax returns would be lowered by a 20% deduction. The 20% deduction would be prohibited for anyone in a service business — unless their taxable income is less than $315,000 if married, $157,500 if single.<\/li>\n
    2. For 2018 there is a 100% bonus depreciation on new assets with a life of 20 years or less except autos which are limited to a first-year deduction of $18,000.<\/li>\n
    3. The corporate rate for C-Corps is now a flat 21% down from 35%.<\/li>\n
    4. Entertainment expenses are no longer allowed and 100% deductible business meals are all now 50%<\/li>\n<\/ol>\n

      The bottom line is that 95% of you will pay fewer taxes for 2018 than you paid in 2017 – whether as an individual or as a business<\/p><\/blockquote>\n

      Please call me for the answers to your questions about early distributions from a retirement fund or planning your retirement. A simple phone call may save thousands of dollars in additional taxes and penalties.<\/p>\n

      Look for your appointment confirmation and questionnaire to come in the mail by January 5th or sooner.<\/strong>  As always feel free to call me anytime for answers to your tax questions (including major events) at no additional cost.<\/p>\n

      Have a Merry Christmas and Happy New Year!<\/p>\n

      – Richard McKay<\/p>\n","protected":false},"excerpt":{"rendered":"

      It’s that time of year again!  Tax season. We talked a little bit about this in last year’s newsletter.  But here is a reminder — The Tax Cuts and Jobs Act of 2017 brought on the biggest changes in tax law history.  Overall, new deductions have been added and some old, common deductions have been … <\/p>\n

      Continue reading “2018 Tax Changes Announcement”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":92,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[15,16],"tags":[19,18,21,17,20],"_links":{"self":[{"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/posts\/88"}],"collection":[{"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/comments?post=88"}],"version-history":[{"count":7,"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/posts\/88\/revisions"}],"predecessor-version":[{"id":105,"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/posts\/88\/revisions\/105"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/media\/92"}],"wp:attachment":[{"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/media?parent=88"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/categories?post=88"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.mckaytax.com\/blog\/wp-json\/wp\/v2\/tags?post=88"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}