The Tax Cuts and Jobs Act, the new tax framework that President Donald Trump signed into law 1½ weeks ago, will take effect in the 2018 tax year. Even though you won’t see the impact of the new law on your finances until you file in 2019, Tisdale recommends that you get familiar with the new provisions.
Major changes include lower tax rates on individual income, a roughly doubled standard deduction ($12,000 for singles and $24,000 for married couples who file jointly), and sharp limits on a slate of itemized deductions, including a $10,000 cap on the break for state income, sales and property taxes.
“It’s a totally new world: State and local deductions have a cap, but the child tax credit has been doubled,” said Tisdale. “This is the year we all need to sit down with our accountants or a tax specialist to understand how the new rules will affect us.”
“On the Money” airs on CNBC Saturdays at 5:30 a.m. ET, or check listings for air times in local markets.
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