It’s time to get ready for tax season by gathering all your income statements, expenses, and deductions to properly and timely file your 2017 taxes. Again this year, we’ll get a couple extra days so Personal taxes need to be filed by April 17, 2018. Be on the lookout for your W-2’s, any 1099’s, Bank statements, all your Self-Employment income and related documents, and even your Lottery winnings. Did you buy or sell a house? Make sure to have your closing documents.
Gather your property tax records, State income taxes, Medical expenses, Education expenses for you and your children, and all Child Care expenses and records.
A question often asked is, “Should I itemize or use the Standard Deduction?” The easiest way to solve this is to compare your Standard Deduction to your Itemized Deductions. Use whichever is greater. Another question has to do with the Individual Mandate. “Is it still in force and will I be penalized for not having insurance?” The answer is, “Yes, the Individual Mandate is still in effect and penalties will be assessed for those without Health Insurance with a few exceptions.
Most of the new tax legislation you’ve been hearing about take effect on January 1, 2018. There won’t be many changes when you figure your 2017 taxes this year, but knowing about the changes may make a difference when dealing with taxes this year. The Standard Deduction is going up, but personal exemptions are being eliminated. There will be caps on Mortgage Interest deductions and on SALT taxes. SALT refers to State and Local Taxes, which will affect the State of Oregon more than most. The deductible portion of your State income taxes is going to be capped.
Federal Withholding tables will be sent out to employers in February which should begin to affect your paychecks. You may want to make changes to your W-4 which effect withholding. Check with your tax professional how making changes will most benefit you.
When choosing a Tax Professional, make sure they are licensed by the State of Oregon and consider using an Enrolled Agent. Enrolled agent status is the highest credential the IRS awards. Enrolled agents, like attorneys and certified public accountants (CPAs), have unlimited practice rights. This means they are unrestricted as to which taxpayers they can represent, what types of tax matters they can handle, and which IRS offices they can represent clients before.
By Michael L Imlah, LTC, EA. If you have any tax questions you are welcome contact me at imlahco@gmail.com or give me a call at 503-332-0938.
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