TAXPAYERS WILL MAKE THIS MOVE IN 2019
February 5, 2019 - Douglas Myser
Taxpayers will make this move in 2019. Though tax season has only just kicked off, many filers are already in the process of gathering their paperwork, combing through receipts, and taking other such necessary steps to get their returns fired off. And while many filers are plenty used to this routine, remember that this is the first year that taxpayers will be preparing their returns under the new set of rules that took effect in 2018. Therefore, many folks might do things differently this year--namely, take the standard deduction rather than itemize on their tax returns. In fact, an estimated 90% of taxpayers will be taking the standard deduction on their 2018 taxes, according to Turbo Tax, which means that even if you've itemized before, it might pay to join the masses this time. Taxpayers will make this move in 2019.
Tax filers have two choices when preparing their returns. They can take the standard deduction as dictated by the IRS, or they can itemize deductible expenses in the hopes that doing so will give them a number that exceeds the standard deduction. Though itemizing is the more complicated option of the two, it can result in a higher break. In recent years, a good 70% of tax filers would claim the standard deduction on their taxes, leaving only about 30% to itemize. Folks who itemized in recent years were usually people who racked up a large number of deductions in mortgage interest, property taxes, and charitable contributions, among other things. But changes to the IRS tax code will make it less attractive for filers to itemize this year when they sit down and do their 2019 tax return. This means more people may owe taxes, who fit into this category. They can contact a Tax Resolution Services company for help prior to the IRS issuing a IRS Wage Garnishment, and may want to ask about the IRS Fresh Start Program.
In 2017, the standard deduction was $6350 for a single tax filer and $12,700 for married couples filing jointly. In 2018, however, these figures nearly doubled to $12,000 for single tax filers, and $24,000 for couples filing joint returns. As such, filers will need to have accumulated a much higher level of deductions to make itemizing worth while.