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5felinefamily
New Member

In the Income Taxes paid section on the Federal routine it has a total paid of $971. last year with very similar numbers this was MUCH higher. What is going on? I owe $

 
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MichaelMc
New Member

In the Income Taxes paid section on the Federal routine it has a total paid of $971. last year with very similar numbers this was MUCH higher. What is going on? I owe $

Many taxpayers are finding that their refunds are smaller than expected or that they owe taxes this year.

In 2018, the withholding tables used by employers were adjusted to put more money into wage earners' paychecks. This was done without fully taking into account the impact of many tax law changes that were also taking effect in 2018. The consequence is that many taxpayers are seriously under-withheld.

The impact of the changes being seen in 2018 federal income taxes, as a result of the Tax Cuts and Jobs Act of 2017, is likely going to vary depending on each individual taxpayer's circumstance and their prior reliance of familiar aspects of the tax code that have seen significant change.

The increase in the Standard Deduction and the elimination of the Personal Exemptions are likely to cause the greatest changes for most taxpayers.

For 2018, the increased Standard Deduction amounts for all filers are:

  • Single or Married filing separately—$12,000.
  • Married filing jointly or Qualifying widow(er)—$24,000.
  • Head of household—$18,000.

Please be aware that this increase in the Standard Deduction is accompanied by the suspension, for tax years from 2018 to 2025, of the Personal Exemption, which in 2017 was $4,050 for the taxpayer, spouse, and each dependent.

For taxpayers who have previously itemized their deductions, it is likely that itemizing will be less attractive, due to the following, and other, changes:

  • State, local, property, and sales tax (SALT) deduction – capped at $10,000 ($5,000 if married filing separately).
  • Mortgage interest – capped at interest on $750,000 of mortgage debt.
  • Home equity loan or line of credit -- interest is deductible only if loan was used to buy, build, or substantially improve your home and your total mortgage debt doesn’t exceed $750,000.
  • Miscellaneous deductions subject to the 2% limit – suspended.
  • Personal casualty and theft losses – suspended (with exceptions).

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1 Reply
MichaelMc
New Member

In the Income Taxes paid section on the Federal routine it has a total paid of $971. last year with very similar numbers this was MUCH higher. What is going on? I owe $

Many taxpayers are finding that their refunds are smaller than expected or that they owe taxes this year.

In 2018, the withholding tables used by employers were adjusted to put more money into wage earners' paychecks. This was done without fully taking into account the impact of many tax law changes that were also taking effect in 2018. The consequence is that many taxpayers are seriously under-withheld.

The impact of the changes being seen in 2018 federal income taxes, as a result of the Tax Cuts and Jobs Act of 2017, is likely going to vary depending on each individual taxpayer's circumstance and their prior reliance of familiar aspects of the tax code that have seen significant change.

The increase in the Standard Deduction and the elimination of the Personal Exemptions are likely to cause the greatest changes for most taxpayers.

For 2018, the increased Standard Deduction amounts for all filers are:

  • Single or Married filing separately—$12,000.
  • Married filing jointly or Qualifying widow(er)—$24,000.
  • Head of household—$18,000.

Please be aware that this increase in the Standard Deduction is accompanied by the suspension, for tax years from 2018 to 2025, of the Personal Exemption, which in 2017 was $4,050 for the taxpayer, spouse, and each dependent.

For taxpayers who have previously itemized their deductions, it is likely that itemizing will be less attractive, due to the following, and other, changes:

  • State, local, property, and sales tax (SALT) deduction – capped at $10,000 ($5,000 if married filing separately).
  • Mortgage interest – capped at interest on $750,000 of mortgage debt.
  • Home equity loan or line of credit -- interest is deductible only if loan was used to buy, build, or substantially improve your home and your total mortgage debt doesn’t exceed $750,000.
  • Miscellaneous deductions subject to the 2% limit – suspended.
  • Personal casualty and theft losses – suspended (with exceptions).

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