Tax Updates

FEDERAL TAX LAW CHANGES THAT BECOME EFFECTIVE JANUARY 1, 2018:

 

NEW FILING DATES EFFECTIVE JANUARY 1, 2017:

 

PARTNERSHIPS; LLCs;  and S CORPORATIONS ARE ALL DUE MARCH 15TH OR THE 15TH DAY OF THE THIRD MONTH FOLLOWING CLOSE OF TAX YEAR.

 

C CORPORATIONS AND INDIVIDUAL TAX RETURNS ARE DUE APRIL 15TH.

 

FBAR RETURNS ARE DUE APRIL 15TH.

 

Changes for 2018 and future:

 

Exemption allowance:  $0 per individual  for 2018

Standard Deduction for  Married Filing Joint (MFJ):  $24,000

Single Filers $12,000

Head of Household Filers $18,000

 

Sales tax, property tax and other State taxes are limited to $10,000 for Schedule A filers.

 

Alimony is not longer deductible

 

Work related expenses previously deducted as miscellaneous deductions subject to 2% of AGI are no longer deductible.

 

Itemized Deductions Phase out starting at MFJ income of $300,000

 

"High Income Earners" are those classified as single earning over $200,000 and Married Filing Joint earning over $250,000.  High income earners will be subject to the new Net Investment Income Tax (NIIT).  NIIT is an additional tax of 3.8% on amounts exceeding the threshold. 

 

Additional Medicare Tax on high income earners of .09%

 

Estate and Gift tax exclusion: $5,250,000

Annual Gift Tax Exclusion per donee: $15,000

 

Health Savings Accounts;  Self-Coverage Only: $3,450

                                            Family Coverage:     $6,900

 

Business Mileage Deduction:  54.5 cents

Medical Mileage Deduction:     18.0 cents

 

Allowable  Federal Deduction for Code Sec. 179 Expense: $500,000 (under review by Congress)(CA does not comply)

 

Effective January 1, 2015 California now issues Earned Income Tax Credits.

 

Your contact person:

Barbara J. Ford, CPA MBA