Tax Tips

Tax Cuts and Jobs Act of 2017

Tax Year 2018 comes with more changes than taxpayers have seen in decades.  Virtually everyone will see a different tax bill than they did last year, after the Tax Cuts and Jobs Act passed in late 2017.  From large increases in standard deductions to the elimination of personal exemptions, the landscape has changed dramatically.

Estimated tax payments

 

Taxpayers with income that is not subject to withholding may have to make estimated tax payments four times a year.  You generally have to make estimated tax payments if you expect to owe tax, including self-employment tax, of $1,000 or more when you file your return.

Charitable Contributions

To be deductible, clothing and household items donated to charity generally must be in good used condition or better. A clothing or household item for which a taxpayer claims a deduction of over $500 does not have to meet this standard if the taxpayer includes a qualified appraisal of the item with the return. Household items include furniture, furnishings, electronics, appliances and linens. 

 To deduct any charitable donation of money, regardless of amount, a taxpayer must have a bank record or a written communication from the charity showing the name of the charity and the date and amount of the contribution. Bank records include canceled checks, bank or credit union statements, and credit card statements. Bank or credit union statements should show the name of the charity, the date, and the amount paid. Credit card statements should show the name of the charity, the date, and the transaction posting date.

Donations of money include those made in cash or by check, electronic funds transfer, credit card and payroll deduction.

These requirements for the deduction of monetary donations do not change the long-standing requirement that a taxpayer obtain an acknowledgment from a charity for each deductible donation (either money or property) of $250 or more. However, one statement containing all of the required information may meet both requirements. 

Standard Mileage Rates

2019 Standard Mileage Rate is $0.58


2018 Standard Mileage Rate was  $0.545


Medical miles and moving are $0.20 in 2019


Charitable miles remain $0.14 


Use IRA RMD to make Charitable Contribution

Taxpayers age 70 1/2 and older can make charitable contributions directly from an IRA, meeting RMD requirements and benefiting charitable organizations, without increasing taxable income.  The maximum transferable amount is $100,000 per taxpayer.  Make sure you get a receipt from the charity to substantiate the donation.