tax cut bill- my understanding

[New York Enrolled Agent]

Gone-- Alimony deduction

Gone??? taxable alimony?

Yes

Section 1309 of the Act also includes a repeal of alimony from gross income

[DonB]

Gone-- Alimony deduction

Gone??? taxable alimony?

[ttbtaxes]

Yes, the new proposal would apply to new debt incurred after 11-2-17. These rules are contained in Section 1302 of the bill.

[kathyc2]

Interest on primary residence only, not second home, starting with new indebtedness

business income tax rate of 25%; the 30%/70% and professional services rules

Are you saying that the interest on second home is grandfathered in?

[ttbtaxes]

Interest on primary residence only, not second home, starting with new indebtedness

business income tax rate of 20%; the 30%/70% and professional services rules

[New York Enrolled Agent]

I didn't see anything about an additional standard deduction amount for seniors.

Sam - Section 1002 of the bill has some conforming amendments:

(2) Section 63 is amended by striking sub- sections (f) and (g).

FYI - §63(f) is where the additional amounts for age & blindness are contained. Thus "gone" (if passed)

[kathyc2]

Kathy

Did you read section 1004 of the bill? It adds a new section 4 to the IRC and gives new meaning to the phrase "tax simplification". It deals with the 25% rate pass through concept.

I tried, but the details of all that made my head hurt.

I was mainly looking if there is stuff I want to give clients a heads up on as to what they can still do this year. The vast majority of my clients that itemize are not over the 24.4K, especially after eliminating state and local tax deduction. For those that are charitable, I'm going to recommend that they look at pushing as much as their planned 2018 giving to 2017 as they have the funds for in order to have it be deductible.

[New York Enrolled Agent]

Kathy

Did you read section 1004 of the bill? It adds a new section 4 to the IRC and gives new meaning to the phrase "tax simplification". It deals with the 25% rate pass through concept.

[kathyc2]

I didn't see anything about an additional standard deduction amount for seniors.

I don't find any reference to 63(c)(3), so I assume it stays.

[Uncle Sam]

I didn't see anything about an additional standard deduction amount for seniors.

[kathyc2]

Also, it looks like Sch A medical expense deduction goes away, but that section had me quite confused.

[kathyc2]

Reading through the actual code of tax change proposal I’m coming up with the following:

Gone:

Personal exemption deduction
Lifetime Learning credit
Student loan interest deduction
Tuition deduction
Employer education exemption
Mortgage interest on second home
Casualty loss deduction
Sch A tax prep and employee business deductions
Alimony deduction
Moving expense deduction and non-taxable exclusion for employer provided benefits for moving
Employer 125 exclusion for dependent care
State and local income tax deduction
AMT

Modified:

AOC expands to 5 years
New mortgages 500K limit for interest deduction
121 exclusion becomes 5 out of 8 years instead of 2/5 and has AGI limitations
Sch A RE deduction limited to 10K
$1000 child tax credit becomes 1,600, but refundable portion is still limited to 1,000

New:
$300 credit for TP, spouse and others on return that don’t get child tax credit

This is what I got from reading though it for non-business 1040 returns. If anyone read something different in it, I won’t be offended to be corrected.