Tax season is here, and it’s the first time taxpayers will fully take President Donald Trump’s 2017 Tax Cuts and Jobs Act into account as they file their taxes this year. Signed into law in December 2017, the Tax Cuts and Jobs Act was the ‘largest tax overhaul since 1986,” according to the Tax Policy Center report, “Effects of the Tax Cuts and Jobs Act: A Preliminary Analysis.”
The far-reaching consequences of the law have yet to be seen, but there are some aspects of the new tax codes that families should pay particular attention to.
“There are things inside this tax reform bill that will, of course, affect families, certainly depending on how many children they have, how high their income is and … whether they claim the standard deduction or not,” says Courtney Edwards, associate director of the UNC Tax Center in Chapel Hill, established by the UNC KenanFlagler Business School.
A draft of the new 1040 form shows it will be a smaller, postcard-sized document that the Trump administration promises will simplify and shorten the filing process. What else do you need to know as you prepare to file? North Carolina tax experts weigh in.
Fewer Exemptions but Higher Deductions
The Tax Cuts and Jobs Act nixed the personal and dependent exemptions many taxpayers have used in the past to reduce their taxable income, but higher deduction amounts may balance this out.