Ted Bauman Shares Useful Tax Tips
January 1st and the new year always bring a lot of excitement. It feels like a new start, so people make their resolutions to make the new year better and more productive than the old one. But another thing the new year brings is the end of the old year, and that means it is closed as far as taxes go. Therefore, after celebrating the new year and making plans for the new year, people must also think about filing their tax returns and paying the taxes they owe. Therefore, it’s also a time for experts in personal finance such as Ted Bauman to give tax advice. That’s especially true this year before Congress passed President Trump’s new tax bill just before Christmas, so many people do not understand all the changes it is bringing. View Ted Bauman’s profile on LinkedIn
One of the changes the new tax law made, effective 2018, is it put limits on the amount of mortgage interest and real estate property taxes that are deductible. Also, the higher standard deduction might keep them from deducting those expenses in 2018. Therefore, Bauman’s first tax tip was for people to prepay their 2018 mortgage interest and property taxes before January 1. People must make sure they deduct both their 2017 and 2018 mortgage interest and real estate taxes when they file their 2017 tax returns in April.
Bauman’s second tax tip is to pay for medical services in December even though you won’t receive them until 2018. Because of a change in the income threshold in 2018, you may not be eligible for the tax deduction in 2018. There is still a penalty under the Affordable Care Act (Obamacare). That doesn’t go away for another year.
Similarly, under the new tax law’s higher standard deduction, some people will no longer find it beneficial to deduct donations to nonprofit organizations. Therefore, Bauman advised his readers to make their 2018 charity deductions in December 2017 so they can take the deductions on their 2017 taxes. And, of course, to take the charity deduction for nonprofit donations, taxpayers must remember to get receipts from the organizations. The IRS does not accept canceled checks.
Bauman is the Editorial Director of Banyan Hill Publishing. He joined the company in 2013, and edits The Bauman Letter, Smart Money Alert and Plan B Club. He specializes in writing about low-risk investments, living and traveling internationally and asset protection. He lives with his family in Atlanta, Georgia. More information can be found at https://tedbaumanguru.com/
— Ted Bauman Guru (@Ted_B_Guru) January 29, 2018