Yes there is more, much more… and remember at Bourke Accounting we are here to help you sort through all of the changes. Call us today at 502-451-8773 or stop by for a visit.
Estate Tax Exemption
- The estate and gift tax exemption is doubled for estates of decedents dying and gifts made after December 31, 2017, and before January 1, 2026. This is accomplished by increasing the basic exclusion amount provided in 2010(c)(3), and is indexed for inflation. The exemption increase to $11,200,000 in 2018.
- The generation skipping transfer (GST) tax exemption is also doubled
Alternative Minimum Tax
- The phaseout thresholds are increased to $1,000,000 for married taxpayers filing a joint return, and $500,000 for all other taxpayers (other than estates and trusts). These amounts are indexed for inflation.
- Individual exemption amount is $70,300
- Married Filing Jointly & Surviving Spouses exemption amount is $109,400
- Married Filing Separately exemption amount is $54,700
- With the exception of state and local income taxes, mortgage interest, medical expenses, disaster losses, charitable contributions and other deductions not subject to the 2% floor, all other itemized deductions are repealed (meaning gone). The overall limitation on itemized deductions for upper income individuals is also repealed.
State and Local Taxes
- Taxpayers can claim a deduction for a combination of state and local income tax, sales tax, or real property tax. The aggregate deduction is capped at $10,000. Foreign real property taxes are no longer deductible.
- Under this provision, an individual may not claim an itemized deduction in 2017 on a pre-payment income tax for a future taxable year in order to avoid the dollar limitation applicable for taxable years beginning after 2017.
- For 2017 through 2018, expenses exceeding 7.5% of income are deductible; that percentage increase to 10% in 2019. Under this provision, these thresholds also apply for determining AMT.
- Taxpayers who are able to itemize deductions can include charitable contributions. The current limitation of 50% of income in increased to 60%.
- The standard mileage rate with regard to the use of a taxpayer’s automobile for charitable purposes is indexed for inflation in taxable years beginning after December 31, 2017.
- The deduction for mortgage interest is capped at $750,000 of debt. The interest deduction is allowed on a first or second home. The interest on home equity loans will no longer be deductible. Interest on up to $1 million of acquisition debt for loans prior to December 15, 2017 is grandfathered.
- Deductions for unexpected losses to personal property are no longer deductible unless covered by specific federal disaster declarations.
- The bill retains the present law above-the-line deduction of $250 (indexed for inflation) for out-of-pocket expenses.
Moving Expense Reimbursements
- The exclusion from gross income and wages for qualified moving expense reimbursements is repealed except in the case of a member of the Armed Forces of the United State on active duty who moves pursuant to a military order.
Yes there are more, so stay tuned for Part 3….