Here are the important tax changes and other pre-tax information you may need before you come into the office. If you have any questions, please contact us via phone at (770) 921-9881 or send an email to either Andrea Kennedy or Becky Portwood.
This year, we had to wait for Congress and the Internal Revenue Service to get their acts together so we could give you a bit of advice concerning your taxes. We are sharing this information with you now, but please realize that any tax law can change just by Congress agreeing on something.
The changes for 2018 are referred to as TCJA (Tax Cuts and Jobs Act). The 2018 tax law changes are the most massive we've had in over 30 years. At least one of the changes will affect everyone. One concern now is to Itemize Deductions (Schedule A) or to take the Standard Deduction (which increased from $12,700 to $24,000 for Joint returns). We have already had an instance that the Standard Deduction gave a bigger Federal refund than with Itemized Deductions; however, when you consider the small Standard Deduction for Georgia, the net tax liability was less with the Itemized Deductions. Therefore, we will be checking to see which method will net the better results.
Some major changes for 2018 include:
1040 1. The only return available; no more 1040A or 1040EZ 2. May require only the one-page, or may require a new Schedule 1-Schedule 6 3. No more personal exemptions Schedule A 1. Taxes (State, Property, etc.) cannot exceed $10,000. 2. Home Mortgage Interest is limited to the interest on the first $750,000 mortgage balances taken out after 12/15/17; limit is still $1 million for mortgages established before 12/15/17. 3. To be deductible, Home Equity Loan Interest must be used to acquire, construct, or substantially improve the home. 4. Miscellaneous Itemized Deductions (employee business expenses, investment fees, safe deposit box, etc.) are eliminated.
Child Tax Credit 1. Increased from $1,000 to $2,000 per qualifying child (must have a valid Social Security Number). 2. Other dependent is $500
Moving Expenses are no longer deductible except for certain members of the military.
The TCJA has added Code Section 199A, Qualified Business Income (QBI). This allows a deduction of 20% of the net income from the QBI to reduce the taxable income. This income can be from self-employment, partnership, S Corporation, or farming. Limitations do apply, and there are certain restrictions.
Casualty and theft losses must have occurred in an area that was declared a presidential disaster area to be deductible.
Once again, the Affordable Care Act requires healthcare coverage. If you did not have healthcare coverage for all of 2018, there will be a penalty on your tax return.
Congress has permitted the IRS to supplement the TCJA with their regulations. Some regulations are not scheduled to be released until mid-2019. The following affect the 2018 filing season: 1. The new rules require more information than in the past to compute taxes. 2. The number-crunching and analysis will be more time-consuming than in prior years, which will translate into increased costs. 3. Because some guidance will be delayed until next summer, many taxpayers will need to file extensions this filing season or possibly amend the returns.
Feel free to send us copies of everything (via e-male, fax, US Mail, UPS, FedEx, etc.) and we will prepare your return and then coordinate a time for you to sign everything. We also have a slot in our door if you need
to drop off your documents after hours.
We value your time so please
MAKE AN APPOINTMENT. Appointments with
our tax specialists are available six (6) days a week. We also accept walk-ins, but priority will be
given to scheduled appointments. Please
note that all visits may take longer than anticipated and appointments and
walk-ins may both get backed up. Once again, we will need a copy of your current State-issued photo identification card (i.e, driver's license).
We MUST HAVE YOUR INFORMATION BY MARCH 31 if you wish to have a chance to have it filed by April 15.