MYRTLE BEACH, SC (WBTW)- You can officially start filing our taxes at the end of the month, and because of the “Tax Cuts and Jobs Act” there will be some major changes.
If you’ve been keeping a box of receipts for your 2018 taxes you may not need it. The biggest change people will see is with standard and itemized deductions. Financial experts said families will be impacted too
The way your tax form looks may have shrunk this year, but when it comes to standard deductions, they doubled. For single filers your standard deduction is now $12,000, for married couples filing jointly it’s $24,000 dollars. That means fewer people will take itemized deductions.
“If it’s not going to amount over 24,000 between all your charity, and mortgage interest, state taxes, and things to that you’re probably not going to need to spend the time putting it together,” said investment advisor, Dr. Christopher St. John.
If you had a major medical procedure it could be worth itemizing. This year, you’re able to claim medical expenses if it exceeds 7.5 percent of your annual gross income, but for 2019 taxes that jumps up to 10 percent.
“Before you spend all the work ask your accountant and look at your return to see if you need to spend the time getting all that information together or you’re not going to be itemizing.” said St. John.
Financial experts said the second biggest change will affect families
“People that want to claim their kids to get that dependency exemption it’s not going to benefit you this year because it’s gone,” said St. John.
The dependent exemption was just slightly over $4,000. The new law did double the child tax credit from $1,000 to $2,000 per child. Experts said after this tax return is over start thinking about 2019
“When you’re spending money you should think about how it affects your tax return,” said St. John.
St. John estimates those who will benefit the most from the new tax law make less than $70,000. If you make $70,000 to $120,000 things should look the same, but above $120,000 may hurt you.