Federal 2019 taxes are changing and you better become aware of what they are.
From US News, “Although the standard deduction nearly doubled to $12,000 for single tax filers and $24,000 for married couples filing jointly, key deductions like state and local taxes and mortgage interest were capped at $10,000. That’s going to hurt people in states where property and or income taxes are high. Further, the tax code suspends miscellaneous deductions, such as certain types of home equity interest deductions and fees paid to accountants and investment advisors – these can no longer be written off.”
So if you are paying high property taxes, like me in New Jersey, you will no longer be able to deduct the amount over $10,000. And in my state that is way too low and it is going to maybe, at least I hope, the catalyst that will cause people here to rethink how our property tax system works.
Also you will not be able to deduct what you paid your account and/or investment advisor anymore. Plus you can not deduct your mortgage interest. Is that not wonderful for all of us, not!
Just to make things even more fun you can no longer deduct alimony if you get divorced this year and the child care credits were change and the $4,050 personal exemption for years 2018 to 2025 was removed. But US News also notes that the, “child tax credit was raised to $2,000 from $1,000 for children under age 17. A separate $500 credit is available for dependents who don’t qualify for the $2,000 credit. He says the total credit starts being phased out for couples with incomes over $400,000 and singles over $200,000 – that’s up from $110,000 and $75,000, respectively, from the 2017 tax year.”
The good news is for businesses and “People who have either a sole proprietorship, a limited-liability corporation, partnership or an S-corporation have more opportunities to deduct expenses, Henley says. Profitable business owners who plan to purchase new assets, such as equipment, can deduct 100 percent depreciation.”
So for this year things will not change, but next year as you have seen from above there are major changes. Just be aware of them and do not panic, at least not yet.
That is my opinion- Jumpin Jersey Mike