Many tax payers that file taxes online are unaware of the updated tax laws and changes. This could widely affect taxpayers, and lead to missing out on some of their tax deductions, tax credits, and a loss on their tax return so here are a few update changes.
Personal exemptions and exemptions with dependents have increased to $3,650 for each exemption from $3,500 each but is phased out at a higher income level.
American tax payers using the standard deductions:
- filing single and married filing separately increased to $5,700 deductions from $5,400,
- married filing jointly increased to $11,400 deductions from $10,900
- head of household increased to $8,350 deductions from $8,000
Earned income tax credit increased to $5,028 from $4,824 for low and moderate income workers and workers with 2 or more children.
Federal Credit is a set law the Federal government set up to help with the cost of getting people into a home giving a $8,000 credit for first time buyers who qualify and $6,500 credit for owners who owned and lived in their home for five years toward the purchase of a new home as their primary resident.
Unemployment benefits: first $2400 is a one time deductions
MORTGAGE DEDUCTIONS
Any points that you had to pay up front to qualify for the a new loan or refinance your existing loan.
Mortgage insurance which is over the period of the loan can be deducted one time, example your insurance is over 30 years so you need to divide it by 30 to get your deduction. Roth IRA Contributions Limits (income threshold) increased to $166,000 from $159,000 for married filing jointly and for filing single and other returns,it has increased to $105,000 from $101.000 .
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