Several provisions from the Tax Cuts and Jobs Act of 2017 and the Bipartisan Budget act of 2018 went into effect in 2019 – in a recent article, Tax Audit reviews what you need to know before filing your return. TaxAudit delivers affordable and effective tax audit defense solutions, protecting and defending thousands of clients in tax audits each year.
Several statutes from the 2017 Tax Cuts and Jobs Act were implemented in 2019, changing many of the filing rules. Here are some noteworthy modifications.
Senior Tax Return Form 1040-SR
This new tax return option for seniors was implemented by the Bipartisan Budget Act of 2018, and it gives seniors – aged 65 and up – a streamlined version of form 1040, with no restrictions to type of income reported or income limits. The form also allows filers to either itemize their deductions on Schedule A or claim the standard deduction. The online version of this form is also easier to read, with a larger font and improved color contrast.
No More Federal Individual Mandate
Failure to have health insurance will no longer result in a federal penalty starting with the 2019 tax year. However, certain states do require residents to have health insurance, and will charge a penalty. These states include Massachusetts and New Jersey, as well as the District of Columbia.
Changed Tax Brackets
The tax brackets have been altered for the 2019 tax year. The new brackets for individual filers are as follows:
- 37 percent: Incomes over $510,300
- 35 percent: Incomes from $204,101 to $510,300
- 32 percent: Incomes from $160,726 to $204,100
- 24 percent: Incomes from $84,201 to $160,725
- 22 percent: Incomes from $39,476 to $84,200
- 12 percent: Incomes from $9,701 to $39,475
- 10 percent: Incomes of $9,700 and under
Alimony Deductions Eliminated/Alimony Payments No Longer Income
Filers paying alimony starting in 2019 will no longer be able to claim alimony payments as a deduction. Additionally, those receiving alimony will no longer be required to claim those payments as income.
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