Impact of New Tax Law
Tax reform and tax cuts have been hotly debated these last few months. Multiple versions of a tax bill have floated between the House & the Senate.
The independent Tax Policy Center estimates that 80% of taxpayers would see a tax cut. On average a household would see a break of $2,100 depending on income. The Tax Policy Center also estimates 5% of the highest earners pay more under the new plan.
So how will your taxes be affected? http://taxplancalculator.com is a tax calculator based on the new tax laws. You can enter simplified information and see the difference for you between the old law and the new law. The calculator works best for taxpayers that don’t have pass through income (ie non-business owners) Hint: Have your 2016 tax return handy.
So what tax laws stayed and what tax laws changed? The following is an abbreviated comparison between the new tax laws and the old. With a 560-page tax bill there is much to be digested. IRS has been tasked with implementing rules and procedures for the new tax law. Hopefully it will bring greater charity, especially on pass through income.
You may want to skip ahead and look at tax planning tips for 2017.
Major Provisions in the Tax Cuts and Jobs Act
Tax Planning Tips for 2017
If your itemized deductions are under $24,000 annually for married or $12,000 for singles, push more itemized deductions into 2017.
- Make an estimated State Tax payment by 12/31/17.
- Pay your full property tax bill for 2018 by 12/31/17
- If cash flow allows, make your charitable contributions for 2018 by 12/13/17.