The Tax Cuts and Jobs Act (TCJA) is 479 pages long and covers a lot of ground. Here are some lesser-known aspects of the new law that might affect you personally.
Adoption. The TCJA retains the tax breaks for adoption expenses.
Alimony. Starting in 2019, taxpayers can no longer deduct alimony payments if they’re required to by a divorce agreement entered into after December 31, 2018. Recipients of affected alimony payments will no longer have to include them in taxable income, as they currently do. (The current tax treatment stays in place for divorce agreements entered into on or before December 31, 2018, however.)
Gift and estate taxes. Starting in 2018, the unified federal gift and estate tax exemption will increase to roughly $11.2 million or $22.4 million for a married couple.
“Green” vehicles. The TCJA retains the tax credit of up to $7,500 for new qualified plug-in electric vehicles.
Moving expenses. Starting in 2018, deductions for most miscellaneous itemized expenses and moving expenses (with an exception for members of the military in certain circumstances) are eliminated. Tax-free employer reimbursements for moving expenses are also eliminated.
Personal casualty and theft losses. Starting in 2018, itemized deductions for personal casualty and theft losses are eliminated, except for personal casualty losses incurred in federally declared disaster areas.
In this time of change, your tax advisor can be a valuable resource, helping you stay atop the latest developments. If you have any questions or would like to know how this may affect you, please contact us today.
For more information related to this topic, please visit our Tax Reform Blog.