New tax law that went into effect at the beginning of 2018

As we approach the Christmas season, I think of my second favorite Christmas story, “How the Grinch Stole Christmas”. I do not want to steal your holiday spirit, but would like to share a few thoughts about taxes before the end of the year.

The new tax law that went into effect at the beginning of 2018 made some significant changes to how your taxes will be computed.  When we prepared your 2017 return this year, we prepared an analysis of how your 2017 income would be taxed under the new law.  For many clients, this analysis showed small to significant decreases in the tax. In addition to lower rates, the IRS and state tax commission have revised withholding tables. Many taxpayers have wondered if the withholding on their paychecks will cover their taxes.  If you would like us to review your withholding before the end of the year, please give us a call.

Another significant change was the increase in the standard deduction, double from what it was last year. Because of this, many taxpayers who itemized last year can take advantage of the higher deduction in 2018. You may not need to spend a lot of time summarizing medical expenses, small charitable contributions, or other miscellaneous deductions. If you are wondering how this affects you, please contact us before you begin this tedious process.

The new law also made some significant changes in how businesses are taxed.  If you have a business and would like to know how your business will be impacted by the new law, please give us a call. We can project how your business will be taxed under the new law.  We may be able to provide some planning ideas in how you can reduce your taxes.

Finally, we’d like you to know that we have moved our office to the other side of our building. Our address is the same, when you come in this year, we are on the right-hand side.

 

Have a wonderful Christmas season and Happy New Year. We look forward to seeing you soon.

 

Dave Stewart

 



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