Happy New Tax Year! Yes, 2018 is here, marking the end of a tax filing system we've used for decades and bringing in a whole new set of tax considerations.
Are you ready? Me neither.
But we can work through this together, with the tax information and advice contained in 2018's Daily Tax Tips.
Two tax systems: There's naturally much interest in and, for many folks, concern about the tax code changes that took effect Jan. 1, 2018, under provisions of the Tax Cuts and Jobs Act.
And we do need to familiarize ourselves with and plan for these changes, which for many are substantial.
But for the first part of 2018, we've also got to file our 2017 taxes. And those returns will be based, for the most part, on the old tax laws.
The Daily Tax Tips, starting with these for January, are designed to help accomplish this task.
We aren't, however, ignoring the fact that the prior year's filing season and the current tax year for which we must plan overlap. That means that some of the Daily Tax Tips will, as they have for years, will offer info on the new tax laws and how we can use them to reduce our 2018 tax bills, especially as we get further into the year.
Weekdays only: Another thing remains the same this 2018 tax year. The Daily Tax Tips will be posted Monday through Friday only.
Yep, I'm still trying to take added me (well, me and hubby) time on weekends. I know I'm not alone here. My blog analytics show that most of y'all are reading on weekdays. (I won't tell your bosses that you're using the office computer!)
Good for all of us for having a more balanced life!
And for now, that scale is tipping to the tax side, so here goes with January's Daily Tax Tips.
Multiple tip access options: You'll find a new tip each weekday in the ol' blog's upper right corner. Clicking on each tip's boldfaced red-font title will take you to the full post or article.
I'll try to get the post up as early as I can each day, but I learned long ago to make as few time-related promises as possible. Life just seems to run on its own schedule, often mocking my own calendars and clocks!
If you miss the daily notice, the tips will once again be collected on monthly directory pages (like this one for January). As the 2018 tax year progresses, I'll post the Daily Tax Tips for February, March and April, thorugh the filing due date, on their own pages.
That's all housekeeping I have. So, with the the tax clock literally ticking down (you can check that out, too, in the ol' blog's right column), let's dive right into January's Daily Tax Tips.
- Tax rates, income brackets for 2017 and 2018 tax years — The first question every taxpayer wants answered is, "How much will I owe?" Get an idea by looking at where your income falls in the annual tax rates and income brackets. Check out 2017's amounts you'll use to figure taxes on your return due in April. Then look at how new tax laws might change what tax bracket you're in so you can do some 2018 planning. (Jan. 8, 2018)
- Standard tax deduction amount changes — Most taxpayers claim the standard deduction rather than go to the trouble to itemize. Check out the 2017 amounts you'll use on your return due April 17 this year, as well as the increased (thanks to new tax laws) standard deductions for tax year 2018. (Jan. 9, 2018)
- Tax credits, deductions, inflation and new tax laws — Many popular tax deductions and tax credits — ranging from Uncle Sam's help in adopting children to paying for schooling to assisting commuters to supporting moderate- and lower-income workers — are affected each year by inflation. Some of those tax breaks also have been changed under the newly-enacted tax laws. Here's how they'll be treated on 2017 and 2018 returns. (Jan 10, 2018)
- Medical itemized deductions easier to claim on 2017, 2018 returns — Inflation adjustments and the new Tax Cuts and Jobs Act provisions mean many changes to health care related tax matters. A popular medical deduction, claiming the many allowable itemized medical expenses on Schedule A, even got easier for tax years 2017 and 2018. (Jan 11, 2018)
- Free File 2018 is now open — The IRS won't process your return until Jan. 29, but you can get it lined up early by using, if you qualify, the now-open Free File option. (Jan 12, 2018)
- Tax breaks for volunteers — The itemized tax deduction for charitable gifts survived basically unscathed in the recent tax laws changes. That means that while you can't deduct the value of the time you volunteer on this Martin Luther King Day (or any other time), you still might be able to claim some service-related contributions on Schedule A. (Jan 15, 2018)
- The scoop on paying estimated taxes — Millions of U.S. taxpayers have to make four extra tax payments every year. The fourth and final one for 2017 is due today. Here's the who, what, when, where, why and how (to pay) of estimated taxes. (Jan. 16, 2018)
- Time to get tax organized — A successful tax filing season starts with preparation, and I'm not talking about just filling out your 1040. To do that properly and in the most expeditious way, you need to be organized. When you have all the data you need to fill out your return, you'll be ready to go the minute the IRS officially opens filing season, which is Jan. 29 this year. (Jan. 17, 2018)
- Tax pro or tax software? — It's time to decide just how you'll do your taxes. You can join millions who opt for tax software to prepare their returns. Or you can get more personal guidance from a tax preparer. Check out these tips on how to determine which method is better for you. (Jan 18, 2018)
- Picking the perfect tax pro — You've decided this year to get professional help in completing and filing your tax return. Here's a look at your tax preparer choices and how to pick the one that is perfect for your tax needs. (Jan 19, 2018)
- How to stop tax procrastinating — It's no fun doing your taxes, even if you're getting a refund. But putting off the annual tax task could make things worse. Here's why we avoid doing our taxes — until the very last, extended minute for many of us! — and how to break our potentially costly tax delay habit. (Jan 22, 2018)
- Is your child your tax dependent? — It's usually pretty clear when a child is a dependent for tax purposes. But there actually are five tests that must be passed to claim your kiddo on your Form 1040. (Jan 23, 2018)
- Tax refund loan alternatives — The recent three-day government shutdown plus the requirement that the Internal Revenue Service hold certain refunds until at least mid-February has many folks thinking about getting a refund advance loan (RAL) or refund advance check (RAC). While these tax-money-up-front programs are more consumer friendly, you might want to think twice before applying, even if you're counting on your tax refund to pay for life's necessities. Instead, consider these options that are totally fee-free. (Jan. 24, 2018)
- 5 tips for Free File users — Free File, the partnership between the Internal Revenue Service and tax software manufacturers, could be a good, and money-saving, move for millions of taxpayers. But before you decide, check out these tips on how to evaluate and use the free e-filing option. (Jan. 25, 2018)
- Don't overlook the EITC — The Earned Income Tax Credit (EITC) provides a welcome, and sometimes quite generous, tax break for millions of Americans. Many, however, don't ever file for it. Here's a look at how to qualify for this tax credit and how much of a tax refund it offers. (Jan 26, 2018)
- Tax filing checklist — The annual tax filing season is officially underway. But before you tackle your 1040, make sure you have all the necessary documents on hand. Also ask yourself some key filing questions to ensure you don't overlook any tax breaks. This checklist can help. (Jan 29, 2018)
- Maximizing medical itemized deductions — Taxes make us jump through many hoops, as well as over an income threshold bar when it comes to medical expense deductions. Here are some ways to maximize your doctor-related costs on Schedule A. (Jan 30, 2018)
- Tax benefits of being a temporary landlord — Is your city hosting a big event, like this weekend's Super Bowl LII or South by Southwest here in Austin or some of the annual NCAA March Madness college basketball tournament games? That craziness could be an easy and tax-free way to make some extra money by turning your home into a short-term rental during the special happening. (Jan 31, 2018)
But wait, there's more! As I mentioned, as soon as January wraps, you can check out February's (and March's and April's) Daily Tax Tips. When those months and tips arrive, the links below will become live.