It’s the start of a new year, which means it’s time to get organized, get planning, and get ahead on this year’s taxes. Not only are there some big changes for tax laws this year, but it’s also a good time to get organized for the tax season ahead so you can beat the last minute tax filing rush. It’s time to think about things like donations and contributions to IRAs and kid’s accounts you just made this past holiday season, as well as all year long. Start planning what you’re going to write off for taxes, and also take a look at what tax deductions will be going away this year too.
There are some new tax laws going into effect in 2019 that you should be aware of now. Over 500 pages of tax code changed in late 2017 and this is the first filing period that will be impacted by those changes. Being prepared before it’s time to file your taxes is a good way to start the year off right. The four major changes you will notice this year are as follows: 5 out of 7 tax rates dropped 2-4% but the income ranges fluctuate a lot for these new rates – be sure to figure out which range you fall into now. Standard deductions are practically doubled this year; however, exemptions are now gone, which you’re likely to notice a difference there from your last filing period. Finally, The Child Tax Credit has a higher phaseout and has been doubled this year, which will be noticed by most taxpayers with children under 17. Other important changes to alimony tax rulings and small business tax laws can be expected as well. We have all the information you need on these new changes.
Now that you know the basics of the major changes you are bound to see, start preparing your tax records today. Don’t delay your filings with commonly forgotten items such as educational expense forms (Form 1098T), small business vendor forms (1099 MISC), and proof of healthcare coverage (Form 1095). You will also be expected to provide proof of investment losses and gains from 2018. Also be aware that filing electronic taxes can be delayed due to the requirement that you review your tax return and send in Form 8879 for electronic filing authorization. Don’t wait until the last minute to get organized.
It’s a new year with big new tax changes. It’s time to start thinking about your New Year’s financial resolutions now, and that begins with you getting prepared for the upcoming tax season. Don’t forget to make contributions to your retirement accounts if you still can, and start collecting your tax records now. If you need help understanding any of these new changes and how they may impact you, give us a call today.