Many decisions you make every year may affect your tax situation. Learn more here.
Yes! The Affordable Care Act with the Preminum Tax Credit to help pay health insurance premiums and the Individual Shared Responsibility Payment is still the law of the land. You must have minimum essential coverage for everyone on your tax return for tax year 2018. If you do not qualify for an exemption from the requirement, you must compute the individual shared responsibility payment. The individual shared responsibility payment will no longer be a requirement starting in 2019 through 2025.
If you purchased health care from Healthcare.gov, or a related state health care exchange, you should have received a form 1095-A. It is required for the preparation of your tax return.
The insurers offering plans on the federal exchange, Healthcare.gov, are reporting increases in premiums for the upcoming year. The income levels to qualify for the health premium tax credit in 2018 incease. The tax credit is available to taxpayers with household incomes from 100% to 400% of the federal poverty level, Federal Poverty Levels for example:
- Single Taxpayers - $12,060- $48,240
- Family of 4 - $24,600 - $98,400
The Tax Cuts and Jobs Act of 2017 eliminates exemptions for tax year 2018. Check to make sure you have enough federal income tax withheld, or estimated tax paid before the end of the 2018 year. Use the IRS withholding calculator at the following link:
This calculator takes into account the new tax law and the 0 value exemptions in 2018. Have your most recent pay-stub or your most recent income statement , if your are self employed, to have accurate figures to plug into the calculator. After answering the questions , the calculator will show you what to do on your form W4 to owe the least amount of tax at the end of the year.
You can indicate you want extra federal income tax withheld by filing an updated form W4 with your employer. If you are self employed adjust your next quarterly payment.
The House and the Senate have passed the tax reform bill. It is signed into law by the President. The provisions of the bill will not begin to take effect until 2018. Tax professionals are working to determine tax strategies to benefit customers in the wake of reform. Watch this space for more information coming soon!
The IRS created publication 2043 to communicate important information about when to expect your refund. Tax payers who claim the Earned Income Credit or the Additional Child Tax Credit will not have their refund released until February 15th. This is a law which is part of the PATH Act, Protecting Americans Against Tax Hikes. The delay will allow the IRS to make sure the credit is claimed correctly. Get Publication 2043 here.
For many taxpayers, tax preparation is not cut and dry. I’ve listed some of the most common reasons my clients use my services below.
Here are some situations which may require my help at tax time:
The sale of your main home
Income from investments
Taking a distribution from a retirement account
Taking the Premium Tax Credit to help pay for your Healthcare.gov purchased health insurance
Receiving a 1099-C , or 1099-A form for the cancellation of personal debt
Income from a partnership or S corporation
It is important to file your return by the due date, or file an extension. The Failure to File penalty imposed can be up to 25% of the tax owed. My goal is to provide you with accurate, timely, tax preparation, communicate the results of your return filing in a timely manner, and provide you with affordable tax preparation services. Other services are available for a separate fee.
You may still be unsure if you need an enrolled agent or not. Reach out to me by phone or email today so we can talk about your individual situation and discuss all of your options.