How will my taxes change in 2018?

published in Consumer Reports, January 22, 2018

The short answer is that for 70 percent of Americans who take the standard deduction, the tax bill probably will go down. Your tax preparer can give you a better idea of how much.

The 185-page Tax Cuts and Jobs Act creates more generous tax brackets and rates than in the past. It also almost doubles the standard deduction; it’s now $12,000 for singles and $24,000 for married people filing jointly.

If you have kids, your child tax credit will double to $2,000 for every dependent child in your household who is under age 17. (You can’t claim the credit for 17-year-olds, or for kids who turn 17 some time during the tax year.) Parents with higher incomes than in the past can now take advantage of this credit.

But while the new law is more generous in many ways, it also eliminates the personal exemption, which at $4,050 per person offered a big tax break to larger families. If you have itemized in the past, you’ll lose a lot of deductions. Your preparer can put all these factors together to determine whether you’ll be better off.

Also, if you’ve been paying the alternative minimum tax, fewer people will be subject to it starting in 2018. Your tax preparer can help you to figure out how this will affect your tax payment.