2018 Tax Forms
More forms and instructions are available from IRS.gov
2017 Tax Law Highlights (Archived)
2016 Tax Update (Archived)
Business and Individual Clients
Major Programs for Business Owners
FAQs to the IRS Stimulus Package
Other Forms and Worksheets
Business or Profession Worksheet
I-9 Employment Eligibility Form
2018 Tax Year Changes
If you are going to be eligible to start receiving Social Security benefits, contact the Social Security Administration 3 months before your eligibility date. You may do so by calling 1-800-772-1213 or reduce processing time by applying online at www.ssa.gov. Click on “Online Services”, then “Apply for Benefits”.
1. NEW TAX LAW:
The Tax Cuts and Jobs Act was signed into law as of December 2017. The new law was a major change to the federal tax code which includes changes to personal and business income taxes. Changes for personal incomes taxes are new tax rates, increased Standard Deductions, elimination of Personal Exemptions, changes to Itemized Deductions and increased Child Tax Credit. Changes for business income taxes include, a new flat corporation tax rate, increased expensing for certain assets and a qualified business income deduction. Many of these changes have complex rules and how they apply to each individual tax return will vary based on your personal circumstances. Your preparer will be able to discuss how the changes affected your tax return.
2. PERSONAL INCOME TAX CHANGES:
The 2018 federal tax rates are 10%, 12%, 22%, 24%, 32%, 35% and 37%.
The Standard Deductions for 2018 are $24,000 for Married filing Joint; $12,000 for single; $18,000 for Head of Household and $12,000 for Married filing Separate.
The Personal Exemption amount for 2018 is $0. However, there are additional tax benefits that are still affected by the number of dependents claimed on the tax return.
The Child Tax Credit is increased to $2,000 per qualifying child. The rules for a qualifying child are the same as 2017 and the child must have a valid Social Security Number.
There is also a smaller, $500, credit for dependents that are not qualifying children for the Child Tax Credit.
Some of the changes to Itemized Deductions include a $10,000 limit on the State and Local Taxes Deduction. This includes Real Estate, Income and Sales Taxes. A limit on the Home Mortgage Interest deduction for the interest on up to $750,000 of loans used only to acquire, construct or substantially improve the home. Miscellaneous Itemized Deductions, that were limited by 2% of Adjusted Gross Income have been eliminated. These include Unreimbursed Employee Business Expenses and Investment Expenses. This does not include Business Expenses for a Self Employed Person. Casualty and Theft Losses are only deductible if they occurred in a federally declared disaster area.
3. BUSINESS INCOME TAXES:
The Corporate Tax Rate for “C” Corporations for 2018 is a flat 21%.
100% Bonus Depreciation is allowed for qualified assets placed in service in 2018. Bonus Depreciation is now allowed for qualified used property.
The 2018 limit for Section 179 expense, for otherwise depreciable assets, is increased to 1 million dollars. The deduction is limited if the total assets placed in service for the year are over 2 million 500 thousand dollars.
The new Qualified Business Income Deduction provides for a deduction from taxable income up to 20% of Qualified Business Income. This Deduction is allowed for income from Self Employment and Qualified Business Income from Partnerships and “S” Corporations. The deduction can be limited based on certain factors including, income and the type of business.
Most of these changes will not affect PA Personal Income Taxes. The PA rules are mostly the same for 2018.
4. AFFORDABLE CARE ACT / PREMIUM TAX CREDIT:
If you purchased insurance from the marketplace in 2018 you will receive a Form 1095A. If you received an Advanced Premium Tax Credit that is also on Form 1095A. That form is required to complete your return. The penalty for not obtaining qualified coverage is still in place for 2018.
5. DELAYED REFUNDS IN 2018:
The IRS will not give a refund or credit for tax returns that have claimed the Earned Income Credit and or the Additional child tax credit before February 15th.
WHAT TO BRING TO YOUR TAX APPOINTMENT
1. Federal, state and local estimated payment vouchers.
2. W-2's, 1099's, SSA statement or business records if you are self-employed.
3. Social security cards for you, your spouse and dependents.
4. Date of birth for taxpayer, spouse and all dependents.