TAX CENTER

2019 FEDERAL Updates/Changes

Business mileage

The mileage rate for 2019 =   .58 cents per mile. Don't forget to keep a log!

Medical Mileage

Medical Mileage for 2019 =  .20 cents per mile. Don't forget to keep a log!

Charity

• Tax exempt status.Ask the charity about its tax-exempt status.  Make sure it is qualified.
• Itemizing. Charitable contributions are only deductible if you itemize on Schedule A.
• Fair market value.  Cash contributions and the fair market value of most property you donate are usually deductable. If you receive something in return, only deduct the amount greater than the benefit.
• Records to keep.  You should keep good records of any donation you make. You MUST have a written receipt from the charity that acknowledges the gift and shows that you did not receive any goods or services in return.
• Large donations.  Non-cash donations in excess of $500 MUST be detailed.  This includes the charity name, address, date of contribution and description of items. For non-cash contributions over $5000, you must have an appraisal that you send with your return.
• Timing.  If you pledge to donate to a charity, only the amount paid during the year qualifies. Check or credit card payments qualify even if the credit card bill doesn't arrive until after Dec 31st.

 College Tuition

In order to claim this credit, the student must either be the taxpayer, spouse or dependent.  If you no longer claim your child as a dependent, you cannot claim his/her tuition.  The credit goes with the student.

Student will receive a 1098-T.

It is important to have records of what was actually PAID for tuition, books, etc.  The student may need to sign into their account at college to get the actual amounts paid.

What's NEW for 2018

You may need to check your withholding if:

  *You are a two income family

  *Have two or more jobs at the same time or work only part of the year

  *Claim credits (Child tax credit)

  *Have dependents age 17 or older

  *Itemized deductions in prior year

  *Have high income or a complicated          return

  *Had a large refund or tax bill prior year

Visit irs.gov/withholding

 Standard deduction increase

Single or Married filing Separate = $12,000

Married filing Joint = $24,000

Head of Household = $18,000

 PERSONAL EXEMPTIONS ARE GONE

Child Tax Credit increased to $2,000 per qualifying child

NEW credit of $500 for each dependent over 17 (rules apply)

Schedule A changes:

  *No longer limited by AGI

  *Medical is deductible after 7.5% of AGI

  *Combined deduction for state and local income, sale, & property taxes limited to $10,000 ($5,000 MFS)

  *No longer deduct job-related expenses or other misc. itemized deductions subject to 2%

  *Home mortgage interest deductions limited to interest up to $750,000 of home acquisition indebtedness (rules apply)

  *Home Equity interest can only be deducted if solely used for the purpose of buying, building, or substantially improving the qualified residence secured by the indebtedness

  *Limit on charitable cash contribution has increased from 50% to 60% of AGI

 Moving expenses are no longer deductible unless you are a member of the Armed Forces on active duty

Social Security Number must be issued for your child before the due date of the 2018 return to be claimed for child tax credit