Tax Cuts and Jobs Act
Tax Act Overview
The Tax Cuts and Jobs Act of 2017, which we will simply call the “Tax Act”, is not retroactive except for a very few unique expensing provisions, so for nearly everyone, your upcoming income tax filing due this spring for the 2017 tax year filing will NOT be effected. However, the changes are more significant than most realize, so now is the time to implement tax planning for 2018 to optimize the greatest tax advantages for your 2018 income tax filing. Below you will find a quick rundown of a few of the significant changes for both individuals and businesses. Be sure to visit our website for a slightly more comprehensive picture.
Also, be aware that many of provisions of the Tax Act are temporary and thus will revert in the future unless Congress takes action to make them permanent. Most of the individual tax changes expire December 31st, 2025. We recommend you contact your Congressman and encourage them to address the temporary nature of much of the Tax Act now. List of Congress members.
Finally, keep in mind that some of the old tax law provisions are grandfathered or may phase in after 2018; to clarifiy, some of the new tax provisions only apply to actions or transactions made starting in 2018 or may not start until after 2018.
Individual Tax . . . the more comprehensive picture of the Tax Act.
Business Tax . . . the more comprehensive picture of the Tax Act.
The Tax Act itself . . . . a direct link to the actual full language.
Tax Act for Individuals – for details visit the links above
- Tax rate – for most it is being reduced (Learn More)
- Tax brackets – for most the brackets are increased (Learn More)
- Standard Deductions – Nearly Double (Learn More)
- Schedule A – Many Itemized Deductions are eliminated (Learn More)
- Mortagage Interest – limits on indebtedness level deductible (Learn More)
- Child Tax Credit – Increase (Learn More)
- Alimoney – No longer deductible (grandfathered) (Learn More)
- Estate Tax – Limit increased to $22.4 million (Learn More)
- AMT – Increased exemption amount (Learn More)
- ACA – Repeals individual manadate penalty (Learn More)
- UNCHANGED – Dividends and Capital Gains (Learn More)
Tax Act for Business – for details visit the links above
- Corporate Tax Rate – Graduated 15% and 35% removed; now 21% (Learn More)
- Passthrough Deduction – New deduction; up to 20% for certain small business incomes (Learn More)
- Bonus Depreciation – Up to 100% (Learn More)
- Real Property – Reduce REcovery Period (Learn More)
- Section 179 Expensing – Increased and qualified real property definition expanded (Learn More)
- Business Interest Deduction – New limit of 30% of adjusted taxable income (Learn More)
- 1031 Exchange – Now excludes property held primarily for sale (Learn More)
- Excessive Employee Compensation – exceptions to compensation over $1 million repealed (Learn More)
- Loss Carry Back – Repealed in most cases (Learn More)
- Corporate AMT – Repealed (Learn More)
- Domectic Production Deduction – Repealed (Learn More)
- Entertainment Expenses Deduciton – Disallowed in most cases though meals remain (Learn More)