2018 Tax Cuts

2018 was the start of a new era in tax law. Many things have changed. Increased standard deductions. No more personal exemption. Increased child credits. A new 20% deduction for pass-through businesses and self-employed people. My view of the new law is that they give you some good stuff over here and then take away some things over there. Some of it will offset, such as the larger standard deduction but no more personal exemptions. But overall, many people will likely pay less tax starting in 2018.

Please understand that every tax return is different. Some people may pay more tax. And just because you pay less tax doesn’t mean you will get a larger refund on April 15th. Withholding tables are being adjusted to try and capture the new rates and deductions. This is a difficult process. It may take a few years and some fine tuning of the withholding system to get people back to the same refund they had in past years.