There’s a lot to know about the new tax law changes, but we’ve attempted to capture the information that impacts most taxpayers below. Remember, these changes will not affect your 2017 taxes. There is plenty of time to start planning now for how this impacts you in 2018!
There are still 7 tax brackets, but the rates have been lowered to: 10%, 12%, 22%, 24%, 32%, 35% and 37%.
One goal of the new tax plan is to decrease the number of taxpayers itemizing deductions. To meet this goal, the standard deduction has become much more attractive as it increases from $6,350 to $12,000 for single filers and increases from $12,700 to $24,000 for anyone married filing jointly. The standard deduction isn’t the only thing that increases under the new law. The child tax credit has doubled to $2,000 per child under 17 and it is available to taxpayers who earn higher amounts than previously allowed.
Several tax breaks will remain in 2018 such as the electric car, classroom supplies, and medical expense deductions. Unfortunately, several big tax deductions and exemptions are done. These include the personal exemption, tax deductions for alimony, tax preparation deduction, moving expense, disaster deductions, and bicycle commuter deduction. The state & local tax deduction now has a $10,000 cap.
It has been 27 years since our country has undergone major tax law changes. This is bound to leave most of us with questions and concerns. If you have questions about specific aspects of the new tax laws, I’m happy to help you navigate!
At this time of year, many taxpayers consider final options to help reduce taxes due. Regardless of who you ask, the top ideas seem to fall under the following 4 categories:
Make contributions to your retirement accounts now!
Take a look at your investments and re-balance as needed. You can utilize up to $3,000 of capital losses above gains to lower your taxable income each year.
Give! Whether to charity or dependents, monetary or non-monetary – now is the perfect time to make donations. Remember to itemize non-monetary gifts to charity as well!
Look for expenses that you can pay now and deduct from this year’s tax bill. Some of these include property tax bills, medical expenses, and estimated state income tax bills
Some additional ideas, applicable depending on your employment situation, include deferring your year end bonus to January if it is approved by your employer. Self employed tax payers having a bit more flexibility with billing can wait until the end of December to bill customers, lowering total income for the year.
There are many reasons to visit a professional tax preparer when tax time rolls around. Like if you have complicated taxes, lots of deductions, exemptions, or credits, too many other things on your plate, or just want to make sure everything is done correctly….then give us a call.
But there are also very good reasons to file online, particularly with File For A Cause!
Filing online can help you stay organized by creating an electronic record for future tax years. It is much easier to go back later and reference these electronic files when you need information quickly.
Online programs often prompt you for tax credits and deductions that you could take advantage of – which could lead to a bigger tax savings for you!
By filing online your accuracy is likely to improve. Filling out paperwork requires that you know which blanks to fill in and how to complete calculations yourself.
It’s generally known to be faster to file and faster to receive a refund. Choosing direct deposit means that you can receive your return in as few as 3 weeks.
It’s easy! Software is simple to use and you can do it from any computer, anywhere, anytime!
Doing something yourself means gaining knowledge and expertise. This enhanced tax wisdom can help to make wiser decisions down the road.
If any of these reasons has you considering online filing, please check out File For A Cause.
Finding the right benefits plan for your employees can be a major headache. Introducing Pam and Trilogy Group Benefits! Trilogy is a local independent brokerage firm, located in Mount Joy, PA. Their specialty is employee group benefits…particularly health, dental, and vision but you can also count on them for group life and short & long term disability. Trilogy prides itself on being able to offer a high level of benefits at a reasonable price for groups from 10 on up.
Pam has worked for Trilogy for 4 years and she enjoys helping people understand their benefits and what those benefits can provide for them. Sharing knowledge with clients is something Pam prides herself in and Trilogy is known for being an organization that provides high level expertise and quality service. Prior to joining Trilogy, Pam owned Grandview Insurance Brokers and she has considerable experience as a stock and bond trader. She founded Grandview Area Business Builders networking group (G.A.B.B.) and is active as a volunteer with the Lancaster Chamber’s Women in Business Mentoring Program.
If you or someone you know are setting up group benefits for your company for the first time, or just looking for competitive group benefits plans, please consider this local business! For more information on Trilogy Group Benefits they can be found at:
This fall, we provided information on planning for college through the ITP blog in Time to Apply! and Back to School. “Time to Apply!” looked at Federal Student Aid which is now open for the 2018-19 school year. In “Back to School” we explored tax credits, deductions, and tuition plans that are available to students.
Today, we want to introduce you to a Financial Advisor who specializes in college planning and 529 plans. Daniel Cieniewiz has been working at 1847Financial for 3 and a half years. 1847Financial has advisors who can help with retirement planning and group benefit plans for businesses, but Daniel has found his passion in helping families prepare for the large expense of college. Daniel can appreciate the amount of time and capital spent in the pursuit of a secondary education and he takes pride in helping to make this expense more manageable for his clients.
1847Financial is located in Shillington, PA with offices throughout the mid-Atlantic. Daniel and his team are centered in Reading where he is able to focus on Berks and Lancaster County. Daniel can show clients ways in which they can save for college and he enjoys the relationships he has been able to establish over the past 3+ years.
If you, or someone you know, is at the college planning stage of life, Daniel is there to help with the process. He can be reached at his office at 610-741-6577 and more information about 1847Financial can be found on their website.
Registered Representative of, and Securities and Investment Advisory Services offered through Hornor, Townsend & Kent, Inc. (HTK). Registered Investment Advisor, Member FINRA/SIPC. 1847Financial, 161 Washington Street, Suite 700, Conshohocken, PA 19428. Phone: 610-771-0800. 1847Financial and ITP Taxes is unaffiliated with Hornor, Townsend & Kent, Inc.