Almost all of the Tax Cuts and Jobs Act (TCJA) changes that will affect individual taxpayers kick in starting with their 2018 Form 1040. Here are the 10 changes that are most likely to affect your return.
- Lower individual rates.
As did prior law, the TCJA has seven tax rate brackets. But five of the rates are lower. Here are the 2018 rates and brackets.
Most folks will benefit from the new rates, but some who were in the 33% marginal tax bracket in 2017 will find themselves in the 35% marginal bracket in 2018. This unfavorable change will mainly affect singles and heads of households with taxable income between $200,000 and $400,000. However, the new lower rates on income below $200,000 will offset some or all of the negative effect of being in the 35% marginal bracket.
Bill Bischoff | MarketWatch