Sunday, February 24, 2019

Income Taxes 2018

I have seen many articles about people receiving lower tax refunds. There is more than one reason why. For some people, such as those living in high tax states, it could be the new limits on itemized deductions. The deductions for state and local taxes, which includes real estate taxes, are now limited to $10,000 due to the Tax Cuts and Jobs Act of 2017. The most common reason, however, is probably the following. New withholding tables quickly followed the Act's passage. For the most part, employers were instructed to withhold less tax from workers in 2018, so that more money would land in their paychecks. As such, much of the money that many filers are expecting this season has already been paid to them via lower withholding last year.

Incidentally, one reason for my lack of posting in the past several weeks is income tax work. Last month I did five days of training in preparation for being an AARP Tax-Aid volunteer three days per week during the tax season, February 1 through April 15. This is my fourth season as a volunteer.

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