Changes to 2018 Taxes

1. Joint Filers: standard deduction of $24,000
2. Single filers: standard deduction $12,000
3. Head of household filer: standard deduction $18,000
4. No personal exemptions
5. Child tax credit $2,000 per qualifying child under 17
6. Mortgage Interest Deduction: Applies to mortgage debt up to $750,000 on mortgages after 12/31/17. Previous mortgages grandfathered in. (itemizers only)
7. Charitable contributions: allowable up to 60% of AGI (itemizers only)
8. Medical expenses: deductible after 7.5% of AGI (itemizers only)
9. State and local taxes: Income, sales and property taxes deductible to $10,000 max (itemizers only)
10. Home Equity interest no longer deductible. (itemizers only)
11. Casualty and theft losses (except those attributable to a federally declared disaster) (itemizers only)
12. Unreimbursed employee expenses no longer deductible. (itemizers only)
13. Tax preparation expenses no longer deductible. (itemizers only)
14. Other miscellaneous deductions previously subject to the 2% AGI cap no longer deductible. (itemizers only)
15. Moving expenses no longer deductible. (itemizers only)
16. Employer-subsidized parking and transportation reimbursement no longer deductible. (itemizers only)
17. College Expenses: Lifetime Learning Credit and Student Loan Interest Deduction stay the same. However, 529 Plan money can now be used for private school, tutoring for K-12, and other levels of education.
18. Affordable Care Act – in 2019 tax year, no penalty for lack of insurance coverage; 2018 still has penalty
19. Capital Gains–Short-term: capital gains taxed as ordinary income (affected by new income tax table)
20. Capital Gains—Long term: (see chart)

The Joint Committee on Taxation estimates that 94% of households will claim the standard deduction in 2018, up from 70% in 2017.

Next time…corporate and business tax changes.

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