What's New For 2018

You may need a paycheck checkup

The new tax law could affect how much tax someone should have their employer withhold from their paycheck. To help with this, the IRS urged taxpayers to visit the Withholding Calculator on IRS.gov. The Withholding Calculator can help prevent employees from having too little or too much tax withheld from their paycheck. Having too little tax withheld can mean an unexpected tax bill or potentially a penalty at tax time in 2019. And with the average refund topping $2,800, some taxpayers might prefer to have less tax withheld up front and receive more in their paychecks.

Current Tax Year 2019 Standard Tax Deductions

These Standard Deduction amounts are for 2019 Tax Returns due on April 15, 2020. Technically, you can e-File 2019 Tax Returns until Oct. 15, 2020. However, late filing or late tax payment penalties might apply. Decide on whether e-Filing a tax extension is best for you or not.

Filing Status

Standard Deduction

Single

$12,200

Head of Household

$18,350

Married Filing Separately

$12,200

Married Filing Jointly

$24,400

Qualifying Widow(er)

$24,400

Deduction for personal exemptions suspended

For 2019, you can’t claim a personal exemption deduction for yourself, your spouse, or your dependents.

Changes to itemized deductions. For 2019, the following changes have been made to itemized deductions that can be claimed on Schedule A.

  • Your itemized deductions are no longer limited if your adjusted gross income is over a certain amount.

  • You can deduct the part of your medical and dental expenses that is more than 7.5 percent of your adjusted gross income.

  • Your deduction of state and local income, sales, and property taxes is limited to a combined, total deduction of $10,000 ($5,000 if married filing separately).

  • You can no longer deduct job-related expenses or other miscellaneous itemized deductions that were subject to the 2 percent of AGI floor. You may still deduct certain other items on Schedule A, such as gambling losses.

  • For indebtedness incurred after December 15, 2017, the deduction for home mortgage interest is limited to interest on up to $1,000,000 of home acquisition indebtedness. This new limit doesn’t apply if you had a binding contract to close on a home after December 15, 2017, and closed on or before April 1, 2018, and the prior limit would apply.

  • You can no longer deduct interest on home equity indebtedness, which means indebtedness not incurred for the purpose of buying, building, or substantially improving the qualified residence secured by the indebtedness.

  • The limit on charitable contributions of cash has increased from 50 percent to 60 percent of your adjusted gross income.

Moving expenses no longer deductible. For 2019, you can no longer deduct your moving expenses unless you are a member of the Armed Forces on active duty.