Taxes

[BOBB]

Finishing up my taxes and all in my total tax bill on nearly identical income is...nearly identical from 2017. Now, my employer took much less out from paycheck to paycheck, so that check is gonna sting a little bit. Thanks for the tax “cut.”

Anyone else getting similar results?

[abdullah_sharif]

still waiting on my k1s amd 1099s... but i’d expect a similar effective tax rate for 2018.

[shockfan89_]

BOBB - Question, did you itemize in 2017, and if so, did you still need to itemize in 2018 or did the higher standard deduction simplify that for you at all?

[BOBB]

shockfan89 itemized in 17. Property tax cap hurt. Also I prepaid some 18 contributions to charity to gain the benefit in 17. That was probably the right decision, but not a runaway like I thought. I was basically a wash in 18 between itemized deductions and standard but ended up taking the standard. I receive some dividends and limited capital gains so it's not like I can file the old 1040ez.

[BOBB]

For the record my effective federal tax rate is 17%.History tells me that is a pretty good deal.

[1972Shocker]

The most common reason for this is that you pay a substantial amount (over $10,000) in state income taxes and property taxes that is no longer deductible this year. Also your SASO dues are no longer deductible. If those numbers were big enough in 2017 the loss of those deductions could offset any benefit of the higher standard deduction.

The impact will vary widely from one taxpayer to another depending on their circumstances.

[shox1989]

Just finished my taxes and compared them to last year. My federal income taxes went UP slightly on basically the same income. The loss of the SASO deduction and other deductions apparently hurt me according to my accountant. He said a lot of people who itemize actually got a tax increase on their federal taxes. According to him, It is those that don't itemize that are coming out ahead.

The increase in my federal taxes was somewhat offset by a small decrease in my state taxes. According to my accountant, most of the deductions that I lost on my federal taxes didn't affect my state taxes (SASO deduction for example he said hasn't been deductible on state since 2012, so losing that deduction didn't hurt me on my state taxes) and my state taxes were lowered because in 2018 they started phasing back in the deductions for property taxes and mortgage interest so that helped me. All very confusing that is why I rely on an accountant.

[abdullah_sharif]

just finished mine and my total tax due went up 6.1% on a 11% increase in income. the small business block deduction helped quite a bit although in future years ill be phased out if experience similar growth rates. max contribution to sep ira helped too.

[abdullah_sharif]

the salt deduction phaseout definitely hurts 1972Shocker.

[1972Shocker]

No doubt the SALT deduction phase-out will hurt some folks. Another one that I am seeing a big impact is the loss of the portfolio deductions in excess of 2% of AGI. In some cases that can be very significant. The great majority of taxpayers won't be impacted by these things however.