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Another year is drawing to a close, and it is time once again to turn our attention to our favorite season – TAX SEASON! Who doesn’t love a good tax return, right?
You may recall that we greeted the start of 2018 with the news that Congress had passed sweeping tax reforms that are supposed to benefit many Americans (albeit for a short period of time).
Here are some highlights of the changes:
- Tax brackets have been changed;
- The tax return itself has received a makeover – there is now only one form – the 1040;
- The standard deductions have been increased:
- Single/Married Filing Separately: $12,000
- Head of Household: $18,000
- Married filing Joint/Surviving Spouse: $24,000
- The personal exemption no longer exists;
- Miscellaneous itemized deductions are gone.
- Mortgage interest and home equity (or 2nd mortgage) interest is only deductible if you used the funds to purchase, build or improve your primary home, or a second home.
- If you used the equity in your primary home to purchase a 2nd home, THAT INTEREST IS NOT DEDUCTIBLE.
- The child tax credit had been increased to $2,000 per qualified child, of which $1400 per child is refundable;