Tax tips: New code offers new options

Posted at 11:29 AM, Jan 23, 2019
and last updated 2019-01-23 14:29:09-05

Americans will see significant changes to their returns this tax season as recent tax cuts and the Jobs Act go into effect.

Among the changes, the standard deduction is nearly doubled, now $12,000 for single taxpayers and $24,000 for joint filers.

“If you make small donations to charity and you keep receipts, going forward you might not need to do that,” says personal finance expert Megan Gorman.

The Tax Policy Center estimates 27 million fewer taxpayers will itemize deductions under the new rules than in 2017.

Taxpayers can now set up what’s called a donor-advised fund to “bunch” together future annual donations into one year, with an immediate tax deduction.

The child tax credit also doubles this year to $2,000 per qualifying child.

Tax prep companies are beefing up software and live support to help taxpayers navigate the new changes, and that assistance may be in high demand with the IRS operating on less than 60 percent of its workforce due to the government shutdown.

The IRS says it plans to process returns and issue refunds on schedule, but the full impact remains unclear.