— about a year from now — your tax return will look very different. And because most changes don’t happen
until then, we have some time to learn about the changes and plan for next year. Here are a few of the biggest
changes that may affect you.
to 37% and the corporate rate is now a flat 21%. The rate chang could benefit you — or in some cases
cause your tax liability to go up.
So this may help you — or hurt you.
(up to $1,400 of which is refundable for each child) and each non-child dependent can now receive a new
credit of $500. But you will have no exemption credit or deduction for yourself, your spouse, or your depenDeardents.
claim the full credits if their adjusted gross income is $400,000 or less ($200,000 for all others). The credits
are fully phased out for married taxpayers filing a joint return when their adjusted gross income reaches $440,000 ($240,000 for all others). This means that many more taxpayers will be able to claim these credits in 2018 and beyond.
- State income tax and property taxes above $10,000 per year in total;
- Moving expenses (with an exception for certain military);
- Employee business expenses such as mileage, travel, entertainment, home office expenses, union dues
- , tax preparation fees, and investment fees, among others;
- Mortgage interest beyond interest on $750,000 of acquisition debt, if you purchase a new home; and
- Mortgage interest paid on equity debt (this is no longer deductible for any taxpayers).
- The medical expense AGI threshold will temporarily drop to 7.5% of AGI for 2017 and 2018;
- The AMT threshold is increased, so fewer middle-income taxpayers will be subject to AMT;
- The estate tax exclusion has nearly doubled, to $10 million (adjusted for inflation); and
- The annual gift tax exclusion remains the same ($14,000 for 2017 and $15,000 for 2018)
- but the maximum rate on gifts is 35%.
for a sole proprietorship, LLC (excluding those taxed as a C corporation), partnership, S corporation, and
rental activity. The rules are incredibly complex but there is a lot of planning that we can do to maximize this
deduction for you. More on this later
As stated above, you will have some changes with respect to any foreign corporations you own all or part
of, but the exact nature of those changes awaits IRS interpretations and regulations.