Standard Deduction and Personal Exemption Changes

Standard Deduction and Personal Exemptions Changes

Standard Deduction

Taxpayers may reduce their adjusted gross income (AGI) by the standard deduction (or sum of itemized deductions) to determine their taxable income.

Under the previous law (for 2017 earnings, which you filed in 2018,) the standard deduction rates were:

  • $13,000 for married individuals filing jointly and surviving spouses
  • $9,550 for head of households
  • $6,500 for single individuals and married individuals filing separately

Under the new law (for 2018 earnings, which you will file in 2019,) the standard deductions increase to:

  • $24,000 for married individuals filing jointly and surviving spouses
  • $18,000 for head of households
  • $12,000 for all other taxpayers

Personal Exemptions

Although standard deductions have nearly doubled under the new tax bill, personal exemptions were eliminated altogether. Whether this will help you or hurt you depends on your household income, filing status, and the number of dependents you have.  Our tax professionals can determine this by preparing a personalized income tax projection for you. Our tax professionals will look at your unique situation and project your estimated taxes, which will point us to the areas where we can help you keep more of your hard-earned money through deductions and prevent an unpleasant surprise when you file your taxes next year. Call us today at (813) 514-8273 to schedule your personalized income tax projection.

Sources:

Thomson Reuters Checkpoint – Special Study on Individual Tax Changes in the “Tax Cuts and Jobs Act”

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