Tax Reform – WInners & Losers Amongst Americans Living Abroad
The tax reform brings many changes. Most of the literature published thus far focuses on corporate tax changes (Ie – Exxon, Microsoft, Apple, etc) as well as changes for U.S. based taxpayers. This article will focus on changes affecting individuals as well as an analysis of who wins, who loses, and how you can save money.
Standard deductions doubled, personal exemptions eliminated.
Who will win: Taxpayers without dependents
Under the old tax code, a single taxpayer would be granted a standard deduction of $6,500 and a personal exemption of $4,150 for 2018 tax year, for a combined deduction of $10,650. Post-reform: New standard deduction is $1,250 greater. Married couple without children will have a combined deduction of $24,000, $2,500 greater than prior to passage of the current bill.
Who will lose: Taxpayers with dependents
Prior to the tax bill, a married couple with two qualifying dependent children would have had a standard deduction of $13,000 and individual exemptions of $16,600, for a combined deduction of $29,600, $5,600 greater than the deduction allowed under post-bill passage stripped off personal exemptions.
Whole Story at TFX.