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We’re firmly in the midst of tax season, with the filing deadline of April 15th getting closer. If you haven’t already, now is a good time to familiarize yourself with the new tax laws effective this year.

Jordan Pope, the Senior Tax Analyst and Marketing Director for H&R Block in Adel and Winterset, says changes to the federal and state tax laws have made a lot of people confused and frustrated when filing their taxes. Pope says the first thing people will notice is the change in documents to fill out. In years past, there were three choices for forms, with 1040, 1040A, and 1040 Easy options. That has now been reduced to just the 1040, so many people will have to fill out a more complicated form than they’re used to.

Another big change came in the rate taxes were gathered, and Pope says many people have had a rude awakening when seeing the size of their refunds. “Don’t be surprised if you thought with this tax bill, ‘Oh wow, I’m going to pay less in taxes and I’m going to have a bigger refund!’ Well, you might end up paying less in taxes because they did decrease those tax brackets, so we’re finding people have a lower tax liability. But on top of that, they also decreased how much they withhold from your paychecks throughout the year. So instead of you getting a bigger refund come filing season, they gave you that refund throughout the year this past year.”

Other important changes include: fewer opportunities to itemize deductions, and previous deductions people could make (like employee expense reimbursements) are no longer allowed; limits to State and Local Tax (SALT) breaks, so people who live in areas with high property values can’t claim as much as in the past; increased standard deductions, but with more taxable income; and the removal of federal deductibility from state returns, so you can no longer claim the amount you paid in federal taxes. Pope adds, the government promised the new tax laws would make filing taxes easier, but he feels that has proven to be false, at least in the first year.

To learn more about the new tax laws, click the link below to listen to our Special Edition In Depth Health and Wealth News Magazine interview with Pope.

https://www.raccoonvalleyradio.com/2019/01/29/health-and-wealth-program-1292019-taxes-and-new-tax-laws/