If you don’t already know, the new tax reform law has been passed. Here is what you need to know about it to file your taxes in 2018: not much. The tax reform effective date is not retroactive, for the most part.
When you file your taxes in 2018, it is for the 2017 tax year. The tax reform effective date is “prospective”. This means they are effective after the bill is passed. Generally speaking, this means they aren’t effective until January 2018. You won’t file your taxes for the 2018 tax year until 2019. Although there are a few provisions of the new law which are retroactive to 2017. This includes a lower threshold for medical expense deductions. The other changes mostly effect the 2018 tax year which means there is an entire year until we see a change in the provisions that affect your 2019 tax refund.
So what do we have to look forward to under the new tax reform law when we file in 2019? That’s a whole different story. We did some reading and googling for you to dig out the details. Here is a great summary of what is in the final version and it is broken down well to understand different types of changes. Some major changes are to the Child Tax Credit and healthcare penalty. And the list goes on… Here are some specific articles that delve into the details so you can begin to understand the changes for tax year 2018 (which you will file for in 2019).
But for now, chill — we have a whole year to wrap our heads around the tax reform changes.
Obama Care Individual Mandate (the healthcare tax penalty)
Changes to Itemized Deductions
Tax Bracket and Standard Deduction Changes
Oh yeah, but don’t forget about the Path Act — this still applies when we file in 2018.
