The Tax Cuts and Jobs Act of 2017 includes many changes, including reducing the tax rates of seven different tax brackets.  Here are some other changes that may impact you:

  • The standard deduction increases to $12,000 for an individual and $24,000 for a family. This change is expected to decrease the number of people who itemize deductions from 30% to as few as 5%.
  • Miscellaneous expenses are no longer deductible (i.e.: tax preparer fees and un-reimbursed business expenses)
  • There is no longer a deduction per dependent.
  • The child tax credit increases to $2,000 per child under 17. Up to $1,400 per child is refundable. You may also qualify for a new $500 credit for non-child dependents (called a Family Tax Credit). However, there are many restrictions, including that the dependent cannot earn more than $4,150 in 2018.
  • In 2018 you can deduct medical expenses that exceed 7.5% of your AGI (in 2019, it increases to 10%).
  • Moving expenses are no longer deductible (and they can no longer be reimbursed tax-free).
  • The AMT (alternative minimum tax) limits have been significantly increased to limit the number of taxpayers subjected to it.
  • The estate and gift tax exemptions are doubled ($11.2 million in 2018).

Most of these changes expire in 2025, unless Congress extends them or makes them permanent.

Similar Articles