Tax Reform is here
Congress has passed a 1009 page tax bill. This bill will be in force from 1/1/2018 on. This new tax reform package will cover taxes filed in early 2019 for 2018. The tax reform bill will NOT effect your 2017 income taxes that we will be preparing in the next couple of months.
I have spent a lot of time familiarizing myself with the new tax law and I can answer most questions that you might have about it. Just give me a call at 260-407-5000 and ask for Mike Sylvester, CPA. When we are done preparing your 2017 income tax returns we will let you know via email what you can expect on the following year’s tax returns due to tax reform.
I have looked at how this tax reform package will effect fifteen of my clients so far. None of those fifteen clients will pay more in 2019 for their 2018 taxes; however, one will break exactly even. The others that I have looked at will see their Federal income taxes decrease by between 6% and 33%.
The following taxpayers are most likely to see large tax savings from this plan:
- People who own a small business that makes a profit. If you make a very large profit it is possible this tax plan will not help you if you own a service business.
- Taxpayers who make between $100,000 and $400,000 per year in taxable income.
- People that have children who are not 17 on the last day of the tax year.
This tax reform package is going to save the majority of our clients a significant amount of Federal income tax from 2018 – 2025. Our clients are going to receive larger tax savings than the national average since so many of our clients own small businesses. Taxpayers in the greater Fort Wayne, Indiana area are also going to get higher tax savings than the national average because the state and local income tax burden and property burden here is lower than the national average.
The individual provisions almost all expire after eight years and the tax code reverts back to what exists today.
Mike Sylvester, CPA