You’ve probably heard that there have been changes to this year’s tax forms and filing processes. But let’s face it — the main thing that’s on your mind is if your refund will be more this year, less this year, or maybe even if you’ll be getting a refund at all.
The answer isn’t so simple because it depends entirely on your personal tax situation. What is important to know is that this is the first tax season when American taxpayers can no longer claim a personal tax exemption.
This change is part of revisions set forth by the Tax Cuts and Jobs Act (TCJA), signed into law in December 2017, which brought sweeping reforms to the U.S. tax system.
Before the TCJA, you were able to claim a personal exemption, which was a set amount of money you could deduct from your taxable income for yourself, your spouse, and each dependent included on your tax return.
Although you can no longer claim a personal exemption, the legislation included other changes that may be beneficial, such as the increase in the standard deduction. If you have dependents or children, you may also benefit from a higher child tax credit.
The standard deduction increased to $12,000 for taxpayers filing as single or married filing separately; $24,000 if married filing jointly; and $18,000 if filing as head of household.
The child tax credit increased to $2,000 per qualifying child.
To get a better understanding of how these changes will impact your tax refund this year, you may wish to consult a tax professional. You can also find additional information about the tax reforms introduced at www.irs.gov/tax-reform.