Find your new tax brackets under the final tax plan

Sort by newest Sort by date
RazorCat

RazorCat

Well-known member
Realizing more details are forthcoming, [] it would appear my tax burden (at least in the income range I reside in ($77,400 to $165,000) ) is reduced on average by 3% in each bracket.
(Married filing jointly is 12% on the first $77,400, 22% on the remainder up to $165,00).
https://www.msn.com/en-us/money/per...-the-final-gop-tax-plan/ar-BBGNbNe?li=BBnb7Kz
https://www.msn.com/en-us/news/poli...ax-overhaul-bill/ar-BBGMRvT?OCID=ansmsnnews11
Opinions, thoughts, comments? How does this affect your current situation?

(PLEASE, PLEASE, PLEASE Do Not start a political debate in this thread. I will personally ask Tom to lock it if it turns political. I'm not looking to get banned. I'm only looking for honest opinions of whether you think the new tax plan will help or hurt you as a single/married/family taxpayer based on the new tax bracket structure and changes to deductions).
 
Last edited by a moderator:
see my comment about tsp modernization regs. Because I want to do some early lumpsum withdrawals for purchasing retirement property that can produce some supplemental income (eventually), it will be a big benefit to me through 2025. If I wanted to just live a retiree life without any big upfront expenses, there would be some small but measurable benefits for me in terms of quality of life takehome income until the new brackets expire. small amounts that could be invested and maybe grow in outside accounts.

I'd be giving considerable thought to doing Roth conversions during the interim as well if wasn't already planning on spending a fair amount of taxable $ on retirement property and small-business startup costs in the interim.
 
RazorCat said:
... the new tax brackets seem to be more beneficial for most people. ...
Click to expand...

Not to "start" a debate either, but instead, to reply to whatever you want to call what you started by posting your political opinion/conclusion above: I disagree.
 
Last edited:
For single, 12 & 22% vs 15 & 25% up to $82.5K is 3% difference. For over $82.5K it goes up to 24%, which is still 1% better than the 25% & 4% better than 28%. The 24% bracket is up to $157K which is currently either the 25 or 28% bracket. It is a little confusing with brackets being different. Overall it seems to be better.

I'm not crazy about how they say they are doubling standard deduction while taking away the exemption--very misleading. If itemizing, reducing the medical expenses exclusion from 10% to 7.5% of AGI for everyone in 2017 & 2018 is beneficial for retirees since your FEHB payment is after tax and can be counted towards the amount used for itemized deductions.
 
Speaking to the changes to the brackets by themselves my tax burden is lessened. I agree the changes to standard deductions and exemptions are a bit confusing at this point. I haven’t had enough deductions to go the long form in quite a few years, so I don’t know that changes to deductions will affect me anyway.
I still favor a simple flat tax, or fair tax strategy. But, then what fun would that be. :smile:
 
Looking over tax returns, specifically exemptions for property taxes, state income taxes and sales taxes, I don’t see the $10,000.00 ceiling being a problem. Property taxes on two homes is around $3,500.00 annually, and I’m exempt from state income taxes (border city exemption). Sales tax I’ll have to wait and see. I’ve offset a lot of sale tax by buying online from site that don’t charge tax, although those are getting fewer and farther between.
Higher income tax states at higher income levels will be the ? mark.
 
That's why I bought the house in Horseshoe, More house for half the tax. :)
RazorCat said:
Looking over tax returns, specifically exemptions for property taxes, state income taxes and sales taxes, I don’t see the $10,000.00 ceiling being a problem. Property taxes on two homes is around $3,500.00 annually, and I’m exempt from state income taxes (border city exemption). Sales tax I’ll have to wait and see. I’ve offset a lot of sale tax by buying online from site that don’t charge tax, although those are getting fewer and farther between.
Higher income tax states at higher income levels will be the ? mark.
Click to expand...
 
RazorCat said:
Realizing more details are forthcoming, [] it would appear my tax burden (at least in the income range I reside in ($77,400 to $165,000) ) is reduced on average by 3% in each bracket.
(Married filing jointly is 12% on the first $77,400, 22% on the remainder up to $165,00).
https://www.msn.com/en-us/money/per...-the-final-gop-tax-plan/ar-BBGNbNe?li=BBnb7Kz
https://www.msn.com/en-us/news/poli...ax-overhaul-bill/ar-BBGMRvT?OCID=ansmsnnews11
Opinions, thoughts, comments? How does this affect your current situation?

(PLEASE, PLEASE, PLEASE Do Not start a political debate in this thread. I will personally ask Tom to lock it if it turns political. I'm not looking to get banned. I'm only looking for honest opinions of whether you think the new tax plan will help or hurt you as a single/married/family taxpayer based on the new tax bracket structure and changes to deductions).
Click to expand...

It all depends on how much you currently have in deductions.
Spousal support, mortgage interest, state taxes, student loans and a few others give me about 40K in deductions. For me it seems I would lose 16K in deductions...I fall in the same income bracket as you do.
 
It appears deductions and credits for student loans are only affected after certain income levels are reached.
GOP Tax Bill: What Will Change for Students | Money
And mortgage interest will only be deductible on the first $500,000.00 of home loans made after November 2, 2017.
https://www.washingtonpost.com/news...s-used-in-blue-states/?utm_term=.e8f8d62a31b3
Spousal support tax exemptions are only eliminated on payments started after December 31, 2017. Current spousal benefits being paid are not affected.
How all that pans out in the final remains to be seen, but that's what I've read to date.
 
FireWeatherMet said:
It all depends on how much you currently have in deductions.
Spousal support, mortgage interest, state taxes, student loans and a few others give me about 40K in deductions. For me it seems I would lose 16K in deductions...I fall in the same income bracket as you do.
Click to expand...

I agree with Fire. If you didn’t use exemptions before, then the reductions in exemptions don’t matter. I am also wondering how my rental real estate will be affected. Is that a so-called pass-through business? I’ll have to talk to my tax man about that. :blink:
 
uscfanhawaii said:
I agree with Fire. If you didn’t use exemptions before, then the reductions in exemptions don’t matter. I am also wondering how my rental real estate will be affected. Is that a so-called pass-through business? I’ll have to talk to my tax man about that. :blink:
Click to expand...
I believe you mean deductions rather than exemptions. The personal exemption(s) of $4K per person is currently subtracted after standard or itemized deduction. For rental property that is passive income, I believe there will not be any impact--Property Tax should still be an expense that can be deducted from rents received. I think it would be the same, even if you "actively participate" in the rental property(s). In either case, any profit calculated on Schedule E is taxed as ordinary income.
 
RazorCat said:
It appears deductions and credits for student loans are only affected after certain income levels are reached.
GOP Tax Bill: What Will Change for Students | Money
And mortgage interest will only be deductible on the first $500,000.00 of home loans made after November 2, 2017.
https://www.washingtonpost.com/news...s-used-in-blue-states/?utm_term=.e8f8d62a31b3
Spousal support tax exemptions are only eliminated on payments started after December 31, 2017. Current spousal benefits being paid are not affected.
How all that pans out in the final remains to be seen, but that's what I've read to date.
Click to expand...

Thanks, yeah I remember that now (only on divorces that occur after Dec 2017).
But, since I would be itemizing anyway, regardless of the doubling of the standard deduction, this is still a tax increase form me by a few thousand dollars, since I can no longer deduct state income taxes, correct?
 
As I understand, a combination of property, sales, and state income tax up to $10,000.00 is still deductible. Don’t know beyond that.
 
I am looking forward to this bill. Not just due to the slight change in tax bracket, but mainly due to the nearly doubling of the standard deduction. I rent and never can itemize enough to reach the standard deduction. So everything I donate is just a free giveaway. Doubling the standard deduction will have a big effect since my margins from month to month are razor-thin. I may finally climb out of this decade-long hole I created when I bought a home in CA with an ARM.
 
evilanne said:
I believe you mean deductions rather than exemptions. The personal exemption(s) of $4K per person is currently subtracted after standard or itemized deduction. For rental property that is passive income, I believe there will not be any impact--Property Tax should still be an expense that can be deducted from rents received. I think it would be the same, even if you "actively participate" in the rental property(s). In either case, any profit calculated on Schedule E is taxed as ordinary income.
Click to expand...

Absolutely right! Deduction not exemption.
I believe you are also right about the passive rental income, but this pass-through profits still have me confused.
 
MrBowl said:
I am looking forward to this bill. Not just due to the slight change in tax bracket, but mainly due to the nearly doubling of the standard deduction. I rent and never can itemize enough to reach the standard deduction. So everything I donate is just a free giveaway. Doubling the standard deduction will have a big effect since my margins from month to month are razor-thin. I may finally climb out of this decade-long hole I created when I bought a home in CA with an ARM.
Click to expand...

Watch out for that ‘doubling of standard deduction’ part....it does double, but the personal exemption goes away, as previously noted. Net result, standard deduction is only slightly higher than before (or even less, depending on what you had as personal exemptions before. All gone now.)
 
To be honest I have been following the tax plan kind of on the fringe since I have no control over what happens. But, doesn't some of these deductions disappear by 2020?
 
nasa1974 said:
To be honest I have been following the tax plan kind of on the fringe since I have no control over what happens. But, doesn't some of these deductions disappear by 2020?
Click to expand...

“Most Americans will pay less in taxes until 2026. The final plan lowers the tax rates for each income level and nearly doubles the standard deduction (while also scrapping the personal exemption). The result is that the vast majority of Americans will see their tax bills drop next year. Trump is fond of saying the "typical" family will save $2,000, but the reality is the amount will vary greatly depending up the size, location and circumstances of each family. The bill will also increase the number of Americans who owe nothing in taxes from 44 percent today to 47.5 percent after the plan tax effect on January 1, 2018. But all of the individual tax cuts are scheduled to go away after 2025. Republicans opted to make tax cuts for families temporary and reductions for businesses permanent.”

https://www.google.com/amp/s/www.wa...gop-tax-bill-is-complete-heres-what-is-in-it/
 
You must log in or register to reply here.
Back
Top