IRS Changes for 2019

IRS Changes for 2019

IRS just announced some inflation adjustments for 2019 regarding some deductions and credits. So if you are wondering what has changed, here is a partial list for next year:

  1. The standard deduction is going up $200 per person. Thus for married couples it will rise to $24,400 and for single people it will be $12,200.
  2. The amount of business equipment that you can elect to expense went up by $20,000, which will go to $1,020,000 for next year.
  3. You can pay your employees (and yourself if you are incorporated) $5 more for qualified parking and transportation tax free. The new number will rise to $265 per month.
  4. This is a big one: This year, if you don’t have essential health coverage under Obamacare, you will be penalized $695. Next year the penalty becomes zero.
  5. You can still give up to $15,000 to each person with no gift tax. This was the same amount in 2018 too. Thus, there is no change in this.
  6. If you are thinking of adopting a child, the maximum credit allowed for qualified adoption expenses went up from $13,810 in 2018 to $14080 next year.
  7. You can earn more money next year before the lifetime learning credit for educational expenses starts phasing out. The phaseout begins at $114,000 for 2018 and is $116,000 for 2019 of adjusted gross income.
  8. Slight increase for inflation to the amounts subject to each tax bracket.

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