The Trump tax calculator — will you pay more or less?

Market Watch ^ | 11-29-17 | Steve Goldstein et al

[RKBA Democrat]

As the Senate advances on its tax-cut bill while House Republicans have passed their version, MarketWatch has the calculator to show how the bills would potentially impact your finances.

The legislation, called the Tax Cuts and Jobs Act, cuts individual tax rates and slashes corporate taxes, among other things.

But not everyone’s a winner. The mortgage-interest deduction is limited, and state and local income tax deductions are zapped in both the House and Senate plan. The plan from the upper chamber also eliminates the state and local property tax deduction.

The calculator includes the new rates and child-tax credit unveiled by the Senate Tuesday night. It’s only meant to give a look at what happens in the first year after enactment, as the individual tax rates are set to sunset.

[CodeToad]

You also get a doubling of exemptions to cover it and the plans include up to $10,000 for tax deductions.

You pay double taxes on all kinds of things from gas to retail, so stop with the righteous indignation.

[OIFVeteran]

Just looked it up and it appears it will take effect for the 2018 tax year.

[CodeToad]

No, they do not. Due to SALT deductions they pay far less.

[GGpaX4DumpedTea]

bump

[cherry]

so it would behove us if we can to pay 2018 property taxes this year so we can take benefit...next year, it won't matter...

also, if the tax bill passes, and if you're working, the only way to save on taxes is to give the max to your 401b or IRA....

anyone else thinking about how to save?

[Cementjungle]

Not enough information for me to figure out where it would leave me.

Most of my income is from investments (cap gains, dividends, etc.) and rental income. We don't know the rates for investment income and don't know how expenses on rentals (property taxes, depreciation, etc.) will be calculated.

I also have some income from self-employment... deductions are important there as well. I also have unused carryover deductions for charitable donations (were too much to use all last year). What happens to things like that?

[Tenacious 1]

I wish they would add a deduction for private education and college tuition.

[Magnum44]

I wish they would add a deduction for private education and college tuition.

Not sure what they are doing with the new bill, but there used to be some educational expense deductions.

As some other have pointed out, there are some things that the tax code could and should be used to incentivize. American families having American kids is one. I think education is another, though I personally think there should be some constraints to avoid that money being wasted on crap degrees. To qualify it should be education that is STEM or otherwise technically rated to skills that are important for our country to have and prosper. Vocational skills should qualify. Real history would be good but "minority cultures" should not qualify.

[petercooper]

I save a lot more with the Senate version. Thought it would have been opposite.

Libs still touting the “Rich getting richer off the backs of the poor” BS. How is that even possible???

[Svartalfiar]

Are you saying I don't make any money? I'm an E6 in the Navy with 14 years of service, a pregnant wife who stays at home and three children. And I pay plenty of taxes.

If you're net paying taxes, then you're not using the refundable part of the credit. If you're getting money 'back' that wasn't part of your withholding, then yes, you are using it. Refundable means you can take the credit into negative taxes and still get it back - it's doesn't limit itself to your taxes paid. So, someone who pays $500 in taxes, but has $2000 in refundable credits would get a bonus check for the extra $1500 - THAT THEY NEVER PAID. It comes out of other people's pockets. If it was a nonrefundable credit, it would take your $500 in taxes and make it $0.

[Svartalfiar]

I wish they would add a deduction for private education and college tuition.

Not sure what they are doing with the new bill, but there used to be some educational expense deductions.

For year 2016, on form1040, line 34 is tuition and fees - use form8917. This is a deduction for adjusted gross income, so you can use it whether you itemize or not. However, if your AGI is over $80k, you can't use it. $65k-80k, it's up to $2000. If AGI is less than $65k, you can deduct up to $4000.

Also, if you fill out a form8863, you can take a tax credit on line 50, education credits, and then line 68 is the American Opportunity credit, which is a refundable credit.

All of this applies whether it's a public or private institution. You might need to read the instructions to confirm if vocational or trade schools also count, I seem to remember some restrictions on those somewhere.

[rxsid]

Thanks for sharing that tax calculator!

[Drago]

These calculators are kinda irrelevant right now...major differences between the House & Senate bills still need to be resolved i.e. the medical expense deduction...eliminated in the House bill and made bigger in the Senate bill.

[Gene Eric]

Indeed they do. In addition to SALT, the average NY household pays 70% more to the fed than the avg GA household.

[cherry]

property taxes NEVER go down...once the euphoria wears off for some about all this great "reform" in a few yrs it will sink in that this was a con job....they will certainly jack the tax rates up and make other changes so we can enlarge the fed. budget by another trillion...

righteous indignation?..yep, I guess so....its deserved...

[Tenacious 1]

To be clear, all bets are off if AGI is >$80K, correct? No deductions, credits or other bennies associated with taxes for education, private or otherwise at any level.

Thank you for the tips.

[Svartalfiar]

To be clear, all bets are off if AGI is >$80K, correct? No deductions, credits or other bennies associated with taxes for education, private or otherwise at any level.

For the income deduction, yes. For the other tax credits, they vary but I think the max allowed is $90k for a single filer. (Doubled for joint.) One of them maxes out at $65k.

https://www.irs.gov/instructions/i8863

[usconservative]

Mine go up quite a bit ..... Not happy with this AT ALL.

[kvanbrunt2]

Curious. Did you base income on your AGI on your tax return or gross salary? You should use the AGI figure. taxable wages as i do not have any income outside a 401k.

[RKBA Democrat]

I used AGI from my tax return.