Standard Deduction: Married filing Joint & Qualifying Widow (er) $24,000.00, Head of Household $18,000.00, Single & Married Filing Separately $12,000.00.
Personal Exemption – has been eliminated.
Child Tax Credit: has been doubled to $2,000 per child beginning in 2018 and is available to be claimed for all your qualified children under age 17 at the end of the year.
AMT Exemption amount: $109,400.00 joint, $70,300.00 single or head of household, $54,700.00 married filing separately.
Minimum wage effective 07/01/2014: http://www.illinois.gov/idol/Laws-Rules/FLS/Pages/minimum-wage-law.aspx
Who needs to file a tax return: https://www.irs.gov/help/ita/do-i-need-to-file-a-tax-return
Kiddie Tax: In 2018, under the new Tax Cuts and Jobs Act (TCJA) the kiddie tax will be based on the much more onerous tax rates for trusts, instead of the tax rates of the child’s parents on unearned income over $2,100 like it was under the old (pre-TCJA) rules. The following table provides an overview:
|2018 Trust Tax Brackets and Rates on Ordinary Income||%|
|$0 to $2,550||10|
|$2,551 to $9,150||24|
|$9,151 to $12,500||35|
Education credit: American Opportunity Tax Credit of $2,500 (100% of the first $2,000 of qualified expenses and 25% of the next $2,000.00) per student, subject to limitation due to adjusted gross income (not available to individuals with income exceeding $80,000 and for married couples with income exceeding $160,000).
Student Loan Interest Deduction: A maximum deduction of $2,500 that phases out for individuals with incomes (AGI) between $65,000 and $80,000 and phases out for married couples with AGI’s between $130,000 and $160,000).
|Business||$0.545 in 2018 ($0.58 for 2019)|
|Charity||$0.14 (does not change, set by statute)|
|Medical||$0.18 in 2018|
|Moving||$0.18 in 2018|
IRA Deduction: Follow this link to see the latest from the IRS:
HSA Deduction: Single maximum is $3,450.00, family maximum $6,900.00 with $1,000.00 catch-up for 55 and older.
401(k) Contribution Limits: $18,500.00 Catch-up limit is $6,000.00 for a total possible of $24,500
FICA Limit: $132,900 for 2019, $128,400 for 2018
Section 179: $1,000,000.00, No reduction in this deduction until capital purchases exceed $2,500,000.00 of property investment on new or used equipment.
Bonus depreciation: for either new or used equipment; a deduction of 100% for equipment purchases made between September 28, 2017 and December 31, 2022.
IRA Required Minmum Distribution (RMD): begins at age 70 ½, see IRS FAQ’s at following link:
Annual Gift Tax Exclusion: $15,000.00; Federal Estate/Gift Tax Unified Exclusion: $5,490,000.00 for 2017 and $11,180,000 for 2018. For Illinois, the exclusion is $4,000,000.00 for 2017 and the same for 2018.
For 2018, FICA taxes are required to be withheld from employee pay at a rate of 6.2% of the first $128,400 and 1.45% for unlimited pay for medicare. An additional medicare tax of 0.9% is required to be withheld from that portion of payroll exceeding $200,000 in a calendar year for those filing as single, head of household and qualifying widow(er) with qualifying child and $250,000 for those filing as married filing jointly, .
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