03/01/2019
It’s getting close to that time of the year. W-2s will be rolling in before you know it. Let me help you prepare your return, as a licensed IRS professional I can assure you that there are ways to better your return by simply hiring an educated individual who specializes in accounting and finance, such as myself. I am by no means trying to sell my services to you. To be honest I don’t love income tax season at all, hints to why I do internal accounting. However, I must complete so many hours to keep my license active. So with that being said, I’d love to work for you and show you the pros and cons of hiring a professional vs turotax. Trust me I’m not knocking the local H&R Block, but you must understand these people are seasonal workers who are trained to fill in the blanks, they aren’t required to have any for of educated relating to taxes. Myself and many other professionals must complete 80 hours of continued education classes yearly to keep our license active, by doing so we learn all the new reforms, tax brackets, depreciation calculations, available credits, and so on. These things are plugged into forms most tax preparers never see. However, they play a crucial role in your return. So if you’re looking for someone new to help file your return feel free to contact me and set up an appointment, before it gets crazy. (Also please fell free to share this post with all your friends, I promise I’ll be forever grateful)
You’ll see below that I have listed a few changes that took place from 2017-2018, sadly most aren’t aware of these changes. But the majority of them will benefit most middle class tax payers.
You should have noticed a slight change in your federal withholding on your paycheck due to the increase in the federal tax brackets per pay rate. For example the standard deduction in 2017 was $6,350 which made a major change going up to $12,000 in 2018. This rate change is based on a single tax payer. Also the rate for a single allowance (child or dependent) went from $142.31 to $159.60(based bi-weekly).
As for the child Tax credit doubling, the tax reform bill makes up for $1,400 of the credit amount refundable. Which in the past years child tax credits were considered a non-refundable credit. But there was a additional credit that made it refundable. So in a nutshell if you, the tax payer shows no income or liability for the 2018 tax year, you can still get a return of $1,400 for each qualifying child starting this year. However, keep in mind this amount will be indexed for inflation in the future years of filing. Also that it does have a cap of 15% if your earned income in excess of $4,500. So if you make more than $13,833 your refundable credit will be capped at $1,400 and if it’s less the refundable credit will decrease.
Now to the income qualifications, this was a great change in my opinion. Just for the reasoning of the cost of living and raising a child. For example I am a single mom who is extremely career driven, which means a higher paycheck and more taxes paid in, without any return. This I do believe has alot to do with the decrease in millennials starting families. We all share the same expense in raising a child yet some of us aren’t credit back. In the past this credit was only available for low-middle class tax payers. Which it started disappearing in 2017 for married couples who made over $110k and singles over $75k. But coming into 2018 there will be a non-refundable “family credit” of $500 for other dependents such as an aging live in parent, or a child over the age of 17....
These aren’t all the changes, but I did find them to be the ones that stood out the most.
Again, please feel free to contact me in you’re looking to file your tax return with a licensed professional.
