Tax

Breaking Down the New Tax Code: What You Need to Know

Rtxt

The new tax code has been a hot topic of discussion since it was passed in December 2017. With the new tax law, there are a lot of changes that will affect how you file your taxes. It’s important to understand the new tax code so you can make sure you’re taking advantage of all the new benefits and deductions available to you. Here’s a breakdown of the new tax code and what you need to know.

The most significant change to the tax code is the new tax brackets. The new tax brackets are lower than the previous ones, meaning that most taxpayers will pay less in taxes. The new tax brackets are 10%, 12%, 22%, 24%, 32%, 35%, and 37%. The new tax brackets are based on your taxable income, which is your total income minus any deductions or credits.

The standard deduction has also been increased significantly. The standard deduction is the amount of income that is not subject to taxation. For 2018, the standard deduction is $12,000 for single filers and $24,000 for married couples filing jointly. This means that if your taxable income is less than the standard deduction, you won’t have to pay any taxes.

The new tax code also eliminates personal exemptions. Personal exemptions were deductions that you could take for yourself, your spouse, and any dependents. Under the new tax code, these deductions have been eliminated.

The new tax code also eliminates the state and local tax deduction. This deduction allowed taxpayers to deduct state and local taxes from their federal taxes. Under the new tax code, this deduction is no longer available.

Finally, the new tax code also eliminates the individual mandate. The individual mandate was a requirement that all individuals have health insurance or pay a penalty. Under the new tax code, this requirement has been eliminated.

The new tax code is complex and there are a lot of changes that will affect how you file your taxes. It’s important to understand the new tax code so you can make sure you’re taking advantage of all the new benefits and deductions available to you. With the help of a tax professional, you can make sure you’re getting the most out of the new tax code.