IRS shrinks the 1040 tax form and does away with the 1040A and 1040EZ forms
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https://www.cnn.com/2018/06/29/politics/irs-1040-form/index.html
Instead of filling two pages, the new version will take up about one, according to a draft released Friday. (The page is cut in half, and is double-sided.) Treasury Secretary Steven Mnuchin said it delivers on the promise to simplify the tax-filing process and provide a simple, postcard-sized tax form.
It will replace the old 1040, as well as the 1040A and 1040EZ, which were shorter forms used by Americans with simpler tax situations. All taxpayers will use the new 1040 to file their taxes starting next year. The new form has 23 lines, down from 79. It gets rid of lines for some types of income such as alimony, capital gains and rental real estate. Taxpayers who earned that kind of income will have to fill out an additional form. Some other lines, like the deduction for education expenses and the student loan interest deduction, have been moved to another form as well.
“What they have essentially done is rearranged the lines, using a lot of additional schedules,” said Joe Rosenberg, a senior research associate at the Tax Policy Center, a nonpartisan think tank.
“The form is more of a gimmick,” Rosenberg said.
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that guy is a bureaucrat. The new forms are a result of the new tax form passed by dems and rep. He fails to mention the standard deduction has almost tripled for single and married folks. Much better. if you live in the high tax states that limit you property deductions you are probably in trouble.
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also the 3 state (NY/Ct/NJ and CA) are probably the worst to live in by far as far a property tax rules. Just this Am The NJ gov is calling for an extra tax on rich people to fund their budget. NY gov Cuomo is tax crazy. he institutes new taxes that are not called taxes. As of 3 months ago there is an electric bill tax of 5.50 for biz and private folks called admin fees that goes to Albany. he wants to tax haircuts and grocery items also. About 6500 folks making over 300k have left the state just in the past 7 months. 750k in the past 2 years.The Ct gov is instituting a 22 cent gas tax and will reinstall tolls on all roads entering and leaving CT. They never think of just cutting costs. They cant with all the giveaway programs in these states. Cuomo just brought up 250 immigrant children (pandering to his base) and is paying for their food/education/health care. They had non existent health care there, so he will fix it…Cost is of no concern. Watch your school taxes baby…
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@barrytuneup and I live in Dutchess County NY which is 76 miles from my workplace and the taxes are lower then in the rest of the state. But I bought a smaller home to avoid the high property taxes further south. Dare I make improvements or expand my rear deck… then taxes shoot up. And no politician here has even done a reassessment for fear of driving out everyone. My house was last assessed in 1989 when it was built. i have a beautiful home at 2200 sq. feet on 2 levels and pay 4800 tax. The same home in fairfield Co CT/Putnam/westester Co NY taxes are 12-14k.
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@barrytuneup said in IRS shrinks the 1040 tax form and does away with the 1040A and 1040EZ forms:
He fails to mention the standard deduction has almost tripled for single and married folks.
Math FAIL.
Prior to TCJA [Tax Cuts and Jobs Act], the standard deduction for tax year 2018 was slated to be:
- $13,000 – Married Filing Joint or Surviving Spouse
- $9,550 – Head of Household
- $6,500 – Married Filing Separate or any other Single filer
For years 2018-2025, the Standard Deduction has been increased to:
- $24,000 for Married Filing Joint or Surviving Spouse
- $18,000 for Head of Household
- $12,000 for Married Filing Separate or any Single filer
Even before taking anything else into consideration, not a single category above is anywhere close to TRIPLE the deduction it was in 2017 (in all cases, it’s just BELOW double).
Then after taking this into account:
Taxpayers can claim an exemption for themselves, their spouse, and their dependents (if eligible). Each exemption lowers taxable income by $4,050 under current (2017) law.
The TCJA has suspended all personal and dependent exemptions for tax years 2018-2025.
For an individual who took the Standard Deduction in 2017 and claimed him/herself as a dependent, (s)he got a $6,500 deduction AND a $4,050 personal exemption, totaling $10,550.
In 2018, that’s been replaced w/ a $12,000 personal deduction (which is indeed higher than $10,550), but it’s nowhere near DOUBLE or TRIPLE what it previously was. It gets even worse for people who have multiple DEPENDENTS (i.e. kids), losing out on a $4,050 exemption per child/dependent. (Some of that is offset by a slightly lower tax rate for those folks).
You already mentioned the hit to those who live in higher PROPERTY TAX states, so you’re aware of the drastic (negative) impact to those folks.
Source for much of the above:
https://www.hrblock.com/tax-center/irs/tax-reform/new-standard-deduction-eliminated-exemptions/
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@thediggler i stand corrected.
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While diggler is 300% correct, one key thing is the elimination of AMT. AMT was neutralizing the exemptions, personal property taxes, state tax deduction etc. Even though I live in CA, my taxes are lower with the new tax laws versus the old one. I think the main reason is that I don’t own a mansion just to get the tax breaks.
