Today’s Smart Money Question:
We’ve talked for months about the tax code changes. Join us as we outline how these changes will affect your personal finances.
(Click the featured times below to jump forward in the episode)
Here Are Just A Handful Of Things You’ll Learn:
3:40 – Tax Code Changes: Standard Deductions.
- If you’re married filing jointly, your standard tax deduction has moved from $12,700 to $24,000. This means if you’re going to itemize your deductions, you’d have to have more than $24,000 in deductions before you’d need a Schedule A tax form for itemized deductions. We also found that about 20 percent of the available deductions from last year won’t be available this year. State And Local Tax (SALT) deductions are also being reduced.
7:04 – Tax Code Changes: Exemptions.
- Uncle Sam used to give you an amount that would reduce your taxable income called an exemption. An exemption is the number of people in your household you’re claiming on your tax return as dependents. That exemption is now gone. This means your taxable income could shoot upward.
9:10 – Tax Code Changes: Your Tax Bill Could Still Go Down.
- There’s good news. Even with the removal of many deductions and exemptions, your overall tax bill could decrease. The new tax code is rearranging the tax bracketing system, and depending on your new bracket, you could actually be taxed less for 2018. As we’re entering the fourth quarter of the year, work with a tax professional, recognize new tax opportunities, and take advantage of them.
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