- The standard deduction has increased for all filing statuses but exemptions have been eliminated. For single people and smaller families this may not cause any tax increase. And because of the increased standard deduction fewer people will be claiming their itemized deductions. Typically a taxpayer will claim the higher of standard or itemized deductions when determining taxable income. Now it will be even more difficult to itemize because many deductions have been eliminated, meaning even less people will be filing a Schedule A. Read more about the standard deduction here.
- You may end up with more taxable income but could fall into a lower tax bracket. This doesn't necessarily mean that you'll pay less tax but it is possible.
- Saving for college isn't just for college anymore. The new tax law has expanded 529 plans to cover both elementary and secondary school as well. Read more about the 529 expansion here.
- The Child Tax Credit has been increased to $2000 and is refundable up to $1400. The intent of an increased child tax credit is to help offset the elimination of the exemptions and help those larger families who would be affected.
- The Individual Health Insurance Mandate has been repealed. This means you will not be penalized for not having insurance starting in 2018.
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