The 2019 tax filing season has officially begun and individual taxpayers will soon be seeing that the good ole 1040 “ain’t what it used to be”! Pages 1 and 2 are not full pages and at first pass, may look simpler. But don’t stop there! Most of what previously appeared on pages 1 and 2 of the 1040 are now moved to six numbered schedules that are each on a separate page. So much for “paperwork reduction”! Starting with the 2018 returns, there will no longer be the option to file with a 1040A or a 1040EZ…they are gone. All individual taxpayers will be using Form 1040.
As you may recall, the Tax Cuts and Jobs Act (TCJA) significantly increased the standard deduction while eliminating all personal exemptions. Due to these changes, most individual taxpayers will no longer be itemizing on Schedule A. IRS estimates that only 1-5% of taxpayers will itemize in 2018. The child tax credit has also increased….but the biggest change is that the income limit for those eligible to claim the credit has increased significantly (up to $400,000 AGI for Married Filing Joint and $200,000 for all other taxpayers).
If I prepare your returns, I am definitely here to walk you through them so that you understand the new layout!