How will the Tax Cuts and Jobs Act of 2017 Impact Business Owners and Individuals in 2018 and Beyond? 

By Tina McNerthney
March 6, 2018

In December 2017, Congress passed the Tax Cuts and Jobs Act of 2017 (TCJA). With the 2017 federal filing deadline approaching, it is a fitting time to take a closer look at changes to tax codes effective in 2018.

We reached out to trusted accounting and tax advisors for resources highlighting how new legislation enacted under TCJA will impact businesses and individuals. We are pleased to share these resources with you.

Tax Cuts and Jobs Act of 2017 Overview
Author: Rob Keasal, CPA, Tax Director at Peterson Sullivan LLP in Seattle, WA
Focus: Impacts to business owners, with emphasis on tax code changes impacting pass-through business owners.

Tax Cuts and Jobs Act of 2017
Author: Rob Keasal, CPA, Tax Director at Peterson Sullivan LLP in Seattle, WA
Focus: Overview of tax code changes impacting individuals and businesses, including personal deductions, excess business losses and the deduction for pass-through income.

Tax Cuts and Jobs Act Highlights
Author: Geffen Mesher & Co.
Focus: Summary of key aspects of new legislation impacting individuals and businesses.

Beginning in 2018, new tax rates and brackets for ordinary income were enacted under TCJA. In late January, new IRS withholding tables were put into effect. While the TCJA generally reduced federal income taxes for most people, depending on your specific tax situation, you might owe additional tax when you file your 2018 income tax return, even if you normally receive a tax refund from the IRS at year-end. (For example, individuals residing in cities and states with high income and/or property taxes may be disproportionately impacted by the new $10,000 (combined) cap on state and local property tax deductions. Likewise, individuals seeking to purchase a home in high-priced housing markets may be impacted by the new $750,000 cap on deductible mortgage debt for loans taken out after December 14, 2017.)

The IRS recently released the 2018 Form W-4, (Employee's Withholding Allowance Certificate), and related instructions, which you can find at www.irs.gov/W4. The IRS also offers an online "W-4 Calculator," at https://www.irs.gov/individuals/irs-withholding-calculator. This calculator may help you determine the correct number of withholding allowances to claim.

The IRS will not require all employees to file a new Form W-4 for 2018. However, for some people it may be advisable as the TCJA made many other changes that could affect your 2018 income taxes.

For questions regarding your personal tax situation, please consult your tax advisor.

Finally, as a reminder, UD+P is on track to publish 2017 Schedule K-1 tax documents for investors in our RERA-II, Tabor I, Tabor II and Tabor III funds by mid-March.