2018 income tax filers may be in for surprises
Under sweeping tax changes in 2018, income tax filers will find many differences in the forms they file this year.
The IRS Tax Time Guide, available online, points out several changes in federal income tax codes.
Instead of having options to file 1040, 1040EZ, or 1040A, this year all filers will use a redesigned 1040 with schedules if needed.
IRS states most people will not need to file schedules with their forms. The six schedules are for claiming additional income or deductions; making an excess advance premium tax credit repayment; claiming nonrefundable credit other than child or other dependent, foreign tax, education, or general business credit; paying other taxes, such as self-employment, household employment, or additional tax on tax-favored accounts such as IRAs; and having a foreign address or third party designee.
Filers may find they owe money instead of getting a refund as they have typically gotten.
Although the standard deduction is nearly doubled for 2018, filers can no longer claim personal and dependent exemptions. Filers who are blind or over 65 can claim a higher standard deduction.
More people can claim a child tax credit, and the credit has doubled. The maximum amount for child tax credit is now $2,000.
Some tax deductions, such as the state tax deduction and mortgage interest deduction, are limited.
If filers owe an underpayment penalty, they might be able to avert having to pay it.
IRS expects most taxpayers will be affected by tax law changes, and offers qualifying filers a waiver of that underpayment penalty.
Form 2210, “Underpayment of Estimated Tax by Individuals, Estates and Trusts,” gives instructions on how to request a waiver of the penalty.
Last modified March 6, 2019