New US Tax Law for 2018

Thought I would start a little discussion on our new tax law which is now in effect for 2018.

Many folks including myself had the idea that this new tax law enacted by our President and Congress was going to benefit us. I strongly suggest that you look into your taxes for 2018 and do some comparison to 2017.

1. The Standard Deduction for 2018 has been raised. (You can look up what yours is.) Taxpayers 65 and over receive an additional standard deduction so that needs to be added in as well.

2. The Personal Exemption has been removed. You can no longer deduct a personal exemption for yourself or other dependents. (Personal exemption for 2017 is $4050 per person eligible.)

3. The tax table rates have been reduced somewhat. For example: My taxable rate went from 15% to 12%. (Rates are according to gross income.)

4. Many deductions have been removed, such as state and local sales tax. Bad news for residents of high tax states. Charitable deduction has been retained along with local property taxes. But there is a limit.

5. Corporate tax rate has been lowered. Good news for Apple. LOL.

If there is anything else you would like to add or comment on, please feel free to do so but let's keep it at a low level. For some folks, taxes set off an alarm bell in their mind and they go ballistic. LOL.

Remember, our government is looking out for you and me! (sarcasm added)

Dear oh dear chscag!

New taxes are NOT to benefit citizens but put more in Government coffers. And right wing governments world wide are reducing corporate taxation under the guise of 'job creation'!

Thanks for the heads up Charlie. I'm sure the "net-net" of the whole thing is (personal exemption removed vs. tax rate gone down)...most of us will end up paying more & keeping less. Lol

- Nick

The sad thing about all of this Nick, is that there are few answers available even from the IRS. (Nothing new there, LOL)

I just a while ago accessed the new Tax Tables and they do reflect the new rates, however, the IRS has thus far not come up with a new W4 form and says to use the 2017 form. The 2017 form still lists the number of exemptions which no longer applies.

The bottom line is that many folks are going to receive quite a surprise as to how much they owe when they compute their 2018 taxes in 2019.

But look at it this way..... Apple is going to get quite a windfall! I wonder if that means the price of an iMac Pro will drop accordingly? ;P

Don't know how accurate this is Charlie (Trump Tax Reform Calculator)...but could give it a try & see what it spits out:

https://www.calcxml.com/calculators/trump-tax-reform-calculator

- Nick

Thanks Nick. I went there are did some round off calculations and it appears I'll likely owe less than 2017. Of course, less is being taken out so it may be a standoff for 2018. But I'll settle for that as long as I don't get hit with a big tax bill in 2019.