Posts Tagged: ‘Tax Reform’

Don’t Leave these Important Tax Deductions on the Table

January 11, 2018 Posted by kingcade

Tax time is almost here and with the new tax rules taking effect January 1, it is easy to get confused on what tax deductions you can and cannot include when filing your return. There are several tax breaks the tax reform eliminated for the 2018 tax year, but are still available to claim on your 2017 tax return.  Here are some of the most popular ones and the last year to take advantage of these tax benefits before they disappear.

Personal exemptions. One of the biggest tax breaks to disappear is the personal exemption. Starting in 2018, higher standard deductions, a larger child tax credit, and a new credit for non-child dependents will take the place of the personal exemption. However, for 2017 you can claim a $4,050 reduction in taxable income for every qualifying dependent. This generally includes yourself, your spouse, and children for whom you provide financial support.

State and local income tax deductions.  Some had initially hoped to prepay 2018 income taxes in 2017 to get further use of the deduction, but lawmakers specifically prohibited this.

Property tax deductions. This year will be the final tax year for which property taxes are deductible in full. Starting in 2018, property taxes will be subject to the same comprehensive $10,000 limit on all state and local taxes.

Mortgage interest deduction on home equity loans. The tax reform eliminated the deduction on home equity loan interest. Therefore, 2017 will be the last year that taxpayers can deduct interest on up to $100,000 in home equity debt as an itemized deduction.

Moving expenses. Tax reform took away the right to deduct your moving expenses. In 2018, to qualify, your new workplace must be at least 50 miles further away from your former home than your old workplace was, and you have to work full time at your new location for at least 39 weeks out of the 12 months following the move.

Miscellaneous deductions. These include unreimbursed employee expenses, tax-preparation fees, investment-related legal and accounting fees, and job-search costs.  These expenses are deductible only to the extent that they exceed 2% of your adjusted gross income.

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If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

How the Tax Reform Could Affect those Paying off Student Loans

November 24, 2017 Posted by kingcade

As lawmakers consider two different bills that would overhaul the tax code, several changes on the table could affect Americans who are paying student loans. The House version of the bill would eliminate some tax benefits for those with college costs. However, the Senate version of the bill would leave most of them untouched. Both bills would eliminate many tax breaks, however; they would also roughly double the standard deduction.

If you are currently paying off your student loans, you can use the student loan interest deduction to lower your taxable income by as much as $2,500. It is an “above the line deduction,” meaning it can be claimed without itemizing. It is available to borrowers with modified adjusted gross incomes up to $65,000 or $130,000 of couples filing jointly. The current tax deduction saves people a maximum of $625 per year. The proposed House bill would repeal the deduction while the Senate bill would keep it in place.

If you are paying for your child’s tuition you can currently claim the American Opportunity Tax Credit for up to $2,500 per child enrolled in college each year. The full credit is available to couples earning up to $160,000 per year and an individual earning up to $80,000 per year. The proposed House bill would expand eligibility to a student’s fifth year at a reduced benefit and the Senate version would keep the credit as it is.

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For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.