Deductions, withholding part of 2018 tax changes

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For many filing taxes isn't fun, it can be time consuming and stressful. Shelby Andrews does it herself. She said, "I don't look forward to doing it but I look forward to the money coming in at the end."

You’ll recall Congress passed a major tax reform plan at the end of 2017. Some of those changes could impact how much money you could get back or what you may have to pay back.

Not only is the tax form different but you'll see that there are no personal exemptions anymore.

Larson & Co., PA tax manager, Margaret Van Skiver said, "for instance a married couple that have two children, would have 4 exemptions."

But what the IRS did to make up for that is increase the standard deduction and the child tax credit.  "For a married couple filing jointly the standard deduction is now $24,000, for someone filing single or who are married but file separately, it's $12,000," Van Skiver said. 

Also, for heads of households, the deduction will be $18,000.

She also noted, the itemized deduction is limited to $10,000 for both income and property taxes paid during the year.

Van Skiver said people really need to pay attention to withholding, that's money from your paycheck that goes to the government. The government has lowered the tax rate and therefore businesses may be withholding less.

Van Skiver said, "so people might have noticed their paychecks increased because the federal withholding went down a little bit and so now we are getting to the point of the year where people should take a look at that."

Van Skiver said if your paycheck is looking bigger than normal you might want to reevaluate your withholding. She said, "if you've not been having enough withhold you could be underpaid meaning that you'll have to pay tax with your tax return in April."

Tax filers like Andrews say they plan to be extra diligent when filing this year because of the changes. "My fear would definitely be to be losing money especially not knowing why I’m losing that money."

Van Skiver suggests if you are still having problems with filing taxes you can always looked to the website for help or you can always seek a professional.

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