2017 saw a lot of the rules change for personal income taxes. Now, in 2018, many of those rules are taking effect for the first time. See what some of them may have in store for you this year.
Standard deductions have increased
Standard deductions have increased to $24,000 if you’re married and filing jointly, $6,500 each if you’re married and filing singly, $12,000 if you’re single, and $18,000 if you’re considered “head of household.”
Child tax credits have increased
The child tax credit was increased to $2,000 per qualifying child. In addition, you may get a $500 credit if you have dependents who do not qualify for the $2,000 credit.
Contribution limits for retirement savings have increased
If your employer offers a 401(k) or 403(b) retirement savings plan, or the Thrift Savings Plan, you can now contribute up to $18,500 per year toward your plan.
Mortgage interest deductions have decreased
You can now take no more than $750,000 in mortgage interest deductions for mortgage loans taken after December 15, 2017.
Personal exemption gets the boot
According to the new tax bill, the personal exemption has been eliminated.
There have been changes to many of the tax brackets for 2018 so check with your accountant to see which ones specifically affect you.