Here is my interpretation of a few of the implications of the Tax Cuts and Jobs Act’s changes to the IRS Form 1040, effective in tax years 2018 and thereafter. While I have seen it written that the IRS has released the 2017 Form 1040, I have been unable to locate the form. So I have marked up this 2016 Form 1040 and the ensuing Schedule A (Itemized Deductions) for your ready reference.
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So, look back to my first email in which I stressed that the calculation of one’s TAXABLE income was more important than focusing upon bracket percentages, here are some areas in red that will be eliminated, or capped—see notes in margins.
You can readily see that the reduction in deductions would otherwise increase one’s taxable income…so go ahead, do your best to plug in numbers that resemble your situation and then you’ll know how urgent it may be for you to take some pro-active steps before January 1, 2018.
Just in case you missed it, here is a link to the 2018 Tax Bracket Breakdown and List of Winners and Losers.