Individual Tax and Planning

Solving customer problems with speed and accuracy has always been our guiding principle. After all, you just don’t have the time to try to understand declining balance depreciation, or foreign tax credits, do you?

At Walpole, our customers count on us to know the answers to dozens of perplexing tax questions every day. The Walpole Team will work with you to answer these tough questions: 

• What impact, if any, does the current economic environment have on your financial future?
• As new tax laws and government regulations take effect, what changes should you make to minimize their impact on your business or personal finances?
• Are you spending time on financial details that really should be managed by someone who’s trained to do just that?
• Do you have complete, accurate financial records?
• Are you fully prepared for an audit, should a notice appear in your mailbox tomorrow?

If you’d rather not think about questions like these, you’re not alone. None other than Albert Einstein once remarked, “The hardest thing in the world to understand, is income tax.”

Are you confused about the new tax bill signed into law at the end of 2017?

You are not alone! If you are looking for some bedtime reading, it’s about 70,000 words long! Even the experts are still uncertain about some of the provisions. It changed the tax landscape for almost everyone, whether you have a modest income or are wealthy, whether you're a business owner or an employee, whether you've been itemizing or taking the standard deduction. Below are some of the most significant changes and Walpole is here to help.

Taxes for Individuals

Bracket changes were a big focus this year for Individuals. Overall, they are lower.

• 10% (income up to $9,525 for individuals; up to $19,050 for married couples filing jointly)
• 12% (over $9,525 to $38,700; over $19,050 to $77,400 for couples)
• 22% (over $38,700 to $82,500; over $77,400 to $165,000 for couples)
• 24% (over $82,500 to $157,500; over $165,000 to $315,000 for couples)
• 32% (over $157,500 to $200,000; over $315,000 to $400,000 for couples)
• 35% (over $200,000 to $500,000; over $400,000 to $600,000 for couples)
• 37% (over $500,000; over $600,000 for couples)

Some other key individual tax changes:

• The standard deduction almost doubles, to $12,000 for singles and $24,000 for couples. This means fewer people will find it beneficial to itemize.
• All state and local tax deductions are limited to $10,000.
• The mortgage interest deduction is limited to payments on $750,000 of debt. (The old $1 million limit will be grandfathered in for homes purchased before Dec. 15, 2017.)
• There is no deduction for home equity loan interest anymore.
• The alternative minimum tax is still with us, but exemptions increased, meaning less people will be paying it.
• The child tax credit is doubled to $2,000, with a refundable portion up to $1,400.
• The estate tax is still in existence, but they doubled the exemptions. The number of families now subject to the federal estate tax is becoming increasingly small.
• The individual mandate required under the Affordable Care Act has been dropped —but not until 2019. It remains required through 2018.