News & Events

IRS Announces 2018 Tax Benefits and Limitations

-by Mike Raftery, CPA

2018 tax benefits and limitationsThe IRS recently released the 2018 figures under current tax law for the following tax benefits and tax limitations that we wanted to pass along. Note that these figures come with the caveat that pending “tax reform” legislation may change these results.

Personal Deductions
-Personal and dependency exemptions will rise from $4,050 in 2017 to $4,150 in 2018.

Standard Deductions
– There will be an increase from $12,700 in 2017 to $13,000 in 2018 for married filing jointly.
– There will be an increase from $6,350 in 2017 to $6,500 in 2018 for single filers and married filing separately.
– There will be an increase from $9,350 in 2017 to $9,550 in 2018 for heads of households.

Itemized Deduction Limitation
In 2018, itemized deductions that can be claimed by taxpayers will begin to phase out for those whose incomes exceeds the following:
$320,00 for married filing jointly
$160,000 for married filing separately
$266,700 for single
$293,350 for heads of households.

Estate and Gift Tax
– The estate and gift tax applicable exclusion will increase from $5,490,000 in 2017 to $5,600,000 in 2018.
– The gift tax annual exemption will increase from $14,000 in 2017 to $15,000 in 2018.

AMT Exemption Amounts
The alternative minimum tax (AMT) exemption:
– will increase from $84,500 in 2017 to $86,200 in 2018 for married filing jointly and surviving spouses.
– will increase from $54,300 in 2017 to $55,400 in 2018 for single and heads of households.
– will increase from $42,450 in 2017 to $43,100 in 2018 for married filing separately.

Please contact a Sansiveri tax professional with any questions you may have regarding tax benefits and limitations, or your other tax concerns, as well at 401-331-0500.