The IRS has announced a filing extension for furnishing the 2017 Forms 1095-B and 1095-C:
- 1095-B is due March 2, 2018 (was January 31, 2018)
- 1095-C is due March 2, 2018 (was January 31, 2018)
The filing due date for the 2017 Forms remains the same, which is February 28, 2018. The Good Faith Transition Relief remains in place.
President Trump signed the new tax plan, officially called the Tax Cuts and Jobs Act, into law last Friday, December 22. The core of the bill is focused on the permanent slashing of the corporate tax rate from 35 percent down to 21 percent.
In addition, individual tax cuts are included, however, those changes will expire at the end of 2025. The most significant change related to health insurance is that the individual mandate will be repealed starting January 1, 2019.
Here is a brief summary of the changes:
- Corporate tax rate decreased from 35 percent to 21 percent, the lowest since 1939
- Individual standard deduction increased significantly:
- $12,000 for single filers – from $6,350
- $18,000 for heads of household – from $9,350
- $24,000 for joint filers – from $12,700
Less people will benefit from itemized deductions.
- Individual tax cuts. IRS should release the new tax tables by early February which means employees could see their take-home pay increase shortly thereafter
- Increases the Child Tax Credit from $1,000 to $2,000
- Personal exemptions will be eliminated which could cause a potential glitch with W-4s. Further guidance will be issued.
- Individual mandate repealed on January 1, 2019, by lowering the penalty to $0
- 529 plans expanded to include paying for K-12 education as well
- Mortgage interest deduction capped at $750,000 (instead of $1 million)
- Property taxes, state and local taxes deductible only up to $10,000, from unlimited amounts.
- Deduction for significant medical expenses has lowered to 7.5 percent (from 10 percent) retroactively starting in 2017
- Other provisions in the bill include changes to Alternative Minimum Tax, Estate taxation, student loan interest, and more
In April of 2018, filing your 2017 taxes won’t be much different with the exception of the retroactive medical expense deduction if it applies to you. Unless otherwise stated, the provisions above apply to the 2018 tax year.
We will continue to send updates as they become available.