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It’s Time to Learn More About Your Loved Ones

It’s Time to Learn More About Your Loved Ones
(Family Features) With days of family picnics, vacations and reunions in the rearview mirror, it’s easy to move full steam ahead into the busy fall season and forget to make time for meaningful conversations with family members.
You may think you know your relatives well, but having meaningful, intergenerational conversations and asking questions about what matters most to them can deepen your relationships. Taking time to get to know your loved ones better can allow you to walk away from these conversations with memories and stories to cherish forever.
If you’re unsure where to begin, the Funeral and Memorial Information Council (FAMIC) created the “Have the Talk of a Lifetime” initiative, which offers families the resources to facilitate conversations that can be remembered for years to come. Having these conversations can be difficult and hard to start, but the Have a Talk of a Lifetime Workbook takes away some of the stress and guides…

The new tax law: What you need to know now

(BPT) - With the Tax Cuts and Jobs Act of 2017 having been signed into law, here are some of the things you should be thinking about as tax season approaches, according to Robert Fishbein, vice president and corporate counsel, Prudential Financial Inc.

2017 tax returns
The new tax law is generally effective starting in 2018, which means that your 2017 income tax return is largely unaffected. However, there may be actions you can take now to benefit from the change. For example, assuming you are eligible, you could fund a traditional IRA before the due date of your tax return; the income exclusion may be more valuable under higher 2017 tax rates.

Lower tax rates and new withholding
The hallmark of the new tax law is lower marginal tax rates for individuals. The IRS has issued withholding tables employers started using in February to reflect these lower rates. While this could mean lower tax withholding and more take-home pay, you should evaluate your personal income tax position to determine if you will pay more or less under the new law and adjust your withholding accordingly.

If you make estimated tax payments, you should also estimate your tax liability under the new tax law and make necessary adjustments to your quarterly tax payments.
Assuming your withholding or estimated tax payments need no adjustment may create an unpleasant surprise if you are under-withheld and owe penalty tax and interest when you file your 2018 income tax return.

Higher standard deduction
The new higher standard deduction of $12,000 for individuals and $24,000 for married couples will greatly reduce the number of taxpayers that itemize deductions. If you did not itemize in 2016, and your tax position is similar now, you will probably not itemize in 2017. The increased standard deduction, combined with lower marginal rates, may mean your tax liability will go down.
If you itemized in 2016, compare your total itemized amount to the new standard deduction. If less, and assuming a similar tax position in 2017, you will likely no longer need to itemize.
For many, this provision will turn out to be the greatest simplification aspect of the new tax law, since they no longer must track itemized deductions or complete multiple associated forms.

No personal exemptions
Some taxpayers will need to look more closely to determine if they will pay less or even more. The new law eliminates personal exemptions and reduces deductible items, such as limiting the total deduction for state and local income taxes to $10,000, reducing the amount of deductible mortgage interest and eliminating the deduction for interest paid on a home equity line of credit. Therefore, if you itemized deductions in 2017 and your deductions were greater than the applicable standard deduction, you will have to consider what deductions are available in 2018 and estimate your tax liability.In states with higher income taxes and property taxes, it is possible that the loss of itemized deductions will be greater than the benefit of lower rates and your tax liability could increase.

Increased child and dependent credits
The new law increases the child tax credit for children under 17 to $2,000. The income limits to phase out the credit are also significantly increased so more taxpayers will be eligible. In addition, there is a $500 credit for other qualifying dependents. Depending on your tax bracket, this could be better or worse than getting an exemption for each dependent.

Increased AMT exemption
Adding one more layer of complexity to your 2018 planning is the new tax law’s modification of the Alternative Minimum Tax or AMT. The AMT is a parallel tax system that requires you to calculate your income tax under the normal rules and then again under AMT rules, paying the higher of the two. The new tax law increases the AMT exemption, or the amount you can earn and not be subject to this alternative tax. If you have been subject to AMT in the past, you should review the new increased exemption and whether that will change.

The bottom line
The bottom line for most is whether they will pay more or less income tax in 2018 than in 2017. While it is likely many will pay less, you need to consider all the above before you know how you will be impacted by the new tax law.

Please consult your legal or tax advisor concerning your particular circumstances. The Prudential Insurance Company of America, Newark NJ and its affiliates.
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