Capital Advisory Group October 2018

ITEMIZED TAX DEDUCTION CHANGES FOR 2018 Deduction 2017 (Old Rules)

2018 (New Tax Law)

Medical Expenses*

Fully Deductible subject to the extent they exceed 10% of AGI. State and Local Property Taxes Fully Deductible

Fully Deductible to the extent they exceed 7.5% of AGI. Deductible up to $10,000 when combined with the deduction for state income taxes Deductible up to $10,000 when combined with real estate taxes Deductible up to $750,000 of acquisition debt. Home equity debt limited to renovation and significant improvements to primary residence.

Real Estate Taxes

State Income Taxes

State and Local Income Taxes Fully Deductible

Mortgage Interest

Deductible up to $1,000,000 of acquisition debt and $100,000 of home equity debt. Can have two homes. Allowed for tax preparation fees, unreimbursed employee expenses, investment advisory fees, etc. Limited to 2% of adjusted gross income Deductible if the qualified casualty exceeded 10% of adjusted gross income In general, a deduction can be claimed for wagering losses to the extent of wagering winnings Contributions are deductible with 50% limitation based on AGI. 80% of contributions made to colleges for atheltic seating rights. Could claim a deduction if the move was related to starting a new job and the new workplace was at least 50 miles further from the taxpayer's former residence than the former place of work. Itemized duductions limited by phase-out beginning at $266,700 (single) and $320,000 (married)

Miscellaneous Itemized Deductions

Miscellaneous Itemized Deductions Eliminated

Personal Casualty Losses

Eliminated with the exception of losses incurred in Federally-declared disaster area

Gambling Losses

In addition to wagering losses, you can also include expenses related to wagering such as transportation and admission fees Increses deducible limitation to 60% of AGI. Elimates contributions related to athetic seating rights. The deduction is suspended with an exception for members of the Armed Forces

Charitable Contributions

Moving Expenses

Income Phase-out for Itemizing Dedcutions

No longer any phase-out for itemizing deductions.

Business Related

Meals provided to employee for the convenience of the employer Company holiday parties, recreational or social activities for employees Business Entertainment (tickets to sporting events, golf, etc.)

Fully Deductible

50% Deductible

Fully Deductible

Fully Deductible (assuming for the benefit of non-highly compensated employees)

50% Deduction (tickets-face value), 100% for qualified charitable events

Deduction Eliminated for All Business Entertainment

Employee Business Travel Meals 50% Deduction

50% Deduction

Business Client Meals (where business is dicussed)

50% Deduction

50% Deduction

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