Tax Bill Passed: What Now?

This week we saw the finality of the approved Tax Bill. Signed by President Trump the morning of December 22nd, things are finally official. Our team has been working diligently to prepare information for you to help clear through the clutter of the robust document, and find out what all this means to you. You can find our breakdowns below – from both the individual and corporate perspectives.

Tax Reform 2018 – Individual Provisions

Tax Reform 2018 – Corporate Provisions

For any questions regarding how this will impact you, please reach out to our team at:

Tax Cuts & Jobs Act - Individual Provisions

Unless noted otherwise, all of the individual provisions will expire on December 31, 2025. This means many of the
disallowed deductions are merely suspended, rather than repealed.

Tax Brackets

The current seven (7) bracket system was retained in the final bill; however, the maximum tax rate has been reduced from 39.6% to 37%.

The 2018 Tax Brackets are amended as follows:

This table also applies to Surviving Spouses.

Standard Deduction and Personal Exemptions

The 2018 Standard deductions are increased to $24,000 for married taxpayers filing a joint return, $18,000 for heads of households, and $12,000 for all other filers. All personal exemptions have been suspended.

Note: The withholding rules will be updated since taxpayers will no longer receive personal exemptions. This means that new Forms W-9 may be required for all employees in 2018, depending on how the rules are modified. It is possible that payroll systems will automatically update without any action on the part of the taxpayer.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.