After each tax season ends, another creeps up on you.
You might wonder what the Tax Cuts and Jobs Act (TCJA) has in store for you this year. The answer is a lot. Many of the common deductions you know will either be limited or removed until 2025, when the TCJA expires.
No more personal and dependent exemptions.
The $4,050 personal exemption that taxpayers claim for themselves, spouses and dependents are no longer available in 2019. Currently, you can still deduct personal exemptions for the 2017 tax year. Click here to deduct your personal exemptions now.
The Standard Deduction doubles.
Continue reading “10 Tax Changes for 2019!”
Be ready for the new tax reform.
Get your to do list out and take some action to reduce your 2018 taxes now! Although taxpayers might be hurriedly finishing their 2017 tax returns before the e-file deadline, some tax deductions will not be there for the next tax season due to the Tax Cuts and Jobs Act. (TCJA) Ultimately, the design of the new tax reform is to lower taxes for individuals of all income groups until 2025. Bear in mind that along with that idea, many individuals who itemize their deductions are worried about the tax turmoil they’ll face when filing with each capped or eliminated deduction.
Did you know that can take steps in 2018 to decrease your taxes for next tax season? Here’s a few tax tips for you.
Rack up your medical receipts.
Continue reading “Tax Reform: Tax Tips for Lowering Rates for 2018 Taxes!”
Claiming a dependent on your taxes can shave off a good amount of your tax liability.
Sometimes, the real issue lies in the rule that only one exemption can be claimed per dependent. This is an IRS rule, and one situation where absolutely no exceptions apply. So if there are two parents who are not filing jointly, and one child, you can see how this has all the makings of an impromptu game of tug-o-war.
So who wins? This question is asked to countless accountants, lawyers and tax professionals each day. The answer is simple. Accepting the answer is the tough part.
The custodial parent can claim the child as a dependent. The non-custodial parent cannot.
Who determines which parent can claim the child dependent exemption?
Contrary to popular belief, a court order will not determine which parent can claim a dependent child. You can wait on hold with the IRS as long as you want. The answer will always come down to federal law; not a state or county court order.
Custodial Parent VS. Non-Custodial Parent
Assuming your child probably refers to you as mom or dad, ‘custodial parent’ is typically not a term thrown around in most households. Generally speaking, the parent with whom the child lives for the majority of nights during the tax year is the custodial parent. The non-custodial parent is the other parent. If the child lived with each parent for the same amount of nights per year, then the custodial parent is the one with the higher Adjusted Gross Income. Continue reading “Who Determines Which Parent Claims a Dependent Child?”