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I was just informed that the $10,000 deduction limit was changed to $12,000. What is the situation?

 
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Hal_Al
Level 15

I was just informed that the $10,000 deduction limit was changed to $12,000. What is the situation?

In past years, every taxpayer got a standard deduction of about $6000 plus a personal exemption of about $4000, for a $10,000 total "deduction".

For 2018, the personal exemption has been eliminated and the standard deduction has been increased to $12,000.

Some people come out better, with this new arrangement, some don't.

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6 Replies

I was just informed that the $10,000 deduction limit was changed to $12,000. What is the situation?

What?  What deduction are you referring to?
**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

I was just informed that the $10,000 deduction limit was changed to $12,000. What is the situation?

You're confusing 2 different things.  
Standard deduction for Single is 12k   
If you itemize, then the limit of deductible state and local taxes is 10K.
♪♫•*¨*•.¸¸♥Lisa♥ ¸¸.•*¨*•♫♪

I was just informed that the $10,000 deduction limit was changed to $12,000. What is the situation?

Are you confusing the $10,000 limit for state and local taxes with the new standard deduction of $12,000 for a single filer?
**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
Hal_Al
Level 15

I was just informed that the $10,000 deduction limit was changed to $12,000. What is the situation?

In past years, every taxpayer got a standard deduction of about $6000 plus a personal exemption of about $4000, for a $10,000 total "deduction".

For 2018, the personal exemption has been eliminated and the standard deduction has been increased to $12,000.

Some people come out better, with this new arrangement, some don't.

I was just informed that the $10,000 deduction limit was changed to $12,000. What is the situation?

We are filing Married filing jointly and the cap is 10K.  If I file as married filing separately, would that increase to 12K?  If the standard deduction is 12K why am I getting a 10K message.  Thank you.  
Hal_Al
Level 15

I was just informed that the $10,000 deduction limit was changed to $12,000. What is the situation?

Two different things. The $10,000 cap refers to the itemized deduction for state and local taxes (income, property and sales taxes), known as SALT.
The standard deduction for Married Filing Separately (MFS) is $12,000 each (half of the $24,000 for married filing jointly-MFJ).
The $10K SALT deduction is just one piece of total itemized deductions (you can add charity and medical to that).

But here's the kicker: if you file MFS and one of you itemizes deductions, the other must also itemize. She cannot use the $12K standard deduction, if you itemize. So, if you're trying to beat the system by filing separately, it won't work.
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