Don’t be a victim of tax identity theft: File your 2017 return early

The IRS has just announced that it will begin accepting 2017 income tax returns on January 29. You may be more concerned about the April 17 filing deadline, or even the extended deadline of October 15 (if you file for an extension by April 17). After all, why go through the hassle of filing your return earlier than you have to? But it can be a good idea to file as close to January 29 as possible: Doing so helps protect you from tax identity theft.

Most individual tax rates go down under the TCJA

The Tax Cuts and Jobs Act (TCJA) generally reduces individual tax rates for 2018 through 2025. It maintains seven individual income tax brackets but reduces the rates for all brackets except 10% and 35%, which remain the same. It also makes some adjustments to the income ranges each bracket covers.

2017 TAX LEGISLATION UPDATE

INDIVIDUAL PROVISIONS

Tax Brackets

The following tax brackets are for the years beginning January 1, 2018.

Single
Married Filing Joint
Married Filing Separate
Head of Household
Bracket

$0 - $9,525
$0 - $19,050
$0 - $9,525
$0 - $13,600
10%

$9,525 - $38,700
$19,050 - $77,400
$9,525 - $38,700
$13,600 - $51,800
12%

$38,700 - $82,500
$77,400 - $165,000
$38,700 - $82,500
$51,800 - $82,500
22%

$82,500 - $157,500
$165,000 - $315,000
$82,500 - $157,500
$82,500 - $157,500
24%

$157,500 - $200,000
$315,000 - $400,000
$157,500 - $200,000
$157,500 - $200,000
32%

$200,000 - $500,000
$400,000 - $600,000
$200,000 - $300,000
$200,000 - $500,000
35%

$500,000 +
$600,000 +
$300,000 +
$500,000 +
37%

 

Standard Deduction

The standard deduction has been nearly doubled, which means the number of taxpayers who itemize will drop drastically.

Which tax-advantaged health account should be part of your benefits package?

On October 12, an executive order was signed that, among other things, seeks to expand Health Reimbursement Arrangements (HRAs). HRAs are just one type of tax-advantaged account you can provide your employees to help fund their health care expenses. Also available are Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs). Which one should you include in your benefits package? Here’s a look at the similarities and differences: HRA. An HRA is an employer-sponsored account that reimburses employees for medical expenses.

Watch out for potential tax pitfalls of donating real estate to charity

Charitable giving allows you to help an organization you care about and, in most cases, enjoy a valuable income tax deduction. If you’re considering a large gift, a noncash donation such as appreciated real estate can provide additional benefits. For example, if you’ve held the property for more than one year, you generally will be able to deduct its full fair market value and avoid any capital gains tax you’d owe if you sold the property.

A charitable remainder trust can provide a multitude of benefits

If you’re charitably inclined but concerned about having sufficient income to meet your needs, a charitable remainder trust (CRT) may be the answer. A CRT allows you to support a favorite charity while potentially boosting your cash flow, shrinking the size of your taxable estate, reducing or deferring income taxes, and enjoying investment planning advantages.