Tax Return Changes
How the average person files their tax return will be different in 2019 as part of the Tax Cuts and Jobs Act, which moved toward a simplified method. However, with any change as large as this there are bound to be some hiccups and issues along the way.
First of all the TCJA aimed to lower the tax rates for most taxpayers (and it did), but in order to do so it doubled the standard deduction. The standard deduction helps most people, but this can hurt the minority of individuals or families who relied on the itemized deductions that are now almost entirely gone. For each taxpayer, it will be important to know where you fall with the new deductions and plan accordingly.
Furthermore, the IRS has been warning all year for filers to update their withholding to make sure money won’t be owed at the end of the year. Anyone who did not update their withholding, may find in they owe money after their taxes instead of a refund. If you are one of these people do not panic, the IRS is actually a friendly creditor to many people and typically will work with your to provide a good installment payment method.
With the New Year soon and taxes right around the corner, it is best to have a team of professionals right by your side to help you through the new tax code. If you need help or have questions, contact us at the Center for Financial Legal & Tax Planning, Inc