Tax Information

• Colorado – 4.63% (2016)
• Illinois – 4.95% (July 2017)
• Indiana – 3.3% (2016) (until 2017, when the rate will fall to 3.23%.
• Note also that counties may impose an additional income tax). 
• Massachusetts – 5.1% (2016)
• (most types of income)
• Michigan – 4.25% (2016)
•  (22 cities in Michigan may levy an income tax, with non-residents paying half the rate of residents)
• North Carolina – 5.75% (2016); 5.499% (2017)
• Pennsylvania – 3.07% (many municipalities in Pennsylvania assess a tax on wages: most are 1%, but can be as high as 3.9004% in Philadelphia)
• Utah – 5.0% (2016)
• As of 2016 records

• Alaska
• Florida
• Nevada
• South Dakota
• Texas
• Washington
• Wyoming

Tennessee - No tax on wages

New Hampshire - No tax on wages

•  Alabama 
•  Alaska 
•  Florida 
•  Hawaii 
•  Illinois 
•  Mississippi 
•  Nevada 
•  New Hampshire 
•  New York 
•  Pennsylvania 
•  South Dakota 
•  Tennessee 
•  Texas 
•  Washington 
•  Wyoming 

Certain restrictions apply to some states, such as age, how much income can be excluded, and other factors.

I will update this page as we get closer to the filing year. 

Under the Tax Cuts and Jobs Act of 2017 (the Act), taxpayers may no longer deduct unreimbursed employee expenses—including unreimbursed expenses related to business use of a personal vehicle—as “miscellaneous itemized deductions” to the extent the total of such expenses exceeds 2 percent of his or her AGI. However, the 2018 alternative standard mileage rate applicable to eligible business use of a vehicle is 54.5¢ per mile, up from 53.5¢ in 2017. In order for such expenses to be deductible, they must have been:

• paid or incurred during the tax year
• for the purpose of carrying on the taxpayer’s trade or business
• ordinary and necessary
•  The standard mileage rate applicable to a taxpayer’s use of a personal vehicle for charitable purposes is based on statute and remains unchanged at 14¢ per mile.  

The Act has increased the standard deduction for 2018. Under the new law, standard deductions are:

• $24,000 for married couples whose filing status is married filing jointly or surviving spouse
• $12,000 for singles and married couples whose filing status is married filing separately
• $18,000 for taxpayers whose filing status is Head of Household

A taxpayer who can be claimed as a dependent is generally limited to a smaller standard deduction, regardless of whether the individual is actually claimed as a dependent. For 2018 returns, the standard deduction for a dependent is the greater of:

• $1,050
• the dependent’s earned income from work for the year plus $350 (but not more than the standard deduction amount, generally $12,000)

The AMTI exemption amount is reduced (but not below zero) by 25 percent of the amount by which the taxpayer’s alternative minimum taxable income exceeds:

• $1,000,000 for taxpayers whose filing status is married filing jointly or qualifying widow(er)
• $500,000 for taxpayers whose filing status is single, Head of Household, married filing separately, and for trusts and estates

This is a pretty big change:

High-income taxpayers are subject to higher capital gain and qualified dividend tax rates. For tax years beginning in 2018, the long-term capital gain and qualified dividend tax rate is 20 percent for married taxpayers filing jointly whose taxable income exceeds $479,000 and to singles whose taxable income exceeds $425,800.

For taxpayers in lower income tax brackets:

• the 0 percent rate applies to:
  • single filers with income up to $38,600
  • joint filers with income up to $77,200
• the 15 percent rate applies to:
  • single filers with income between $38,601 and $425,800
  • joint filers with income between $77,201 and $479,000

Before passage of the Act, an eligible educational institution at which a distribution for expenses of enrollment or attendance would be considered qualified education expenses under a § 529 Tuition Savings Plan included an educational institution eligible to participate in a student aid program administered by the U.S. Department of Education such as a:

• college
• university
• vocational school
• other post-secondary educational institution

Elementary and secondary school expenses were not considered qualified education expenses. The Act broadens the definition of qualified education expenses by authorizing an annual qualified distribution of contributions made after December 31, 2017 (and income on such contributions) of up to $10,000 from all of a taxpayer’s § 529 plans for elementary or secondary school tuition. Such schools may be:

• public
• private
• religious

 Many taxpayers have encountered individuals impersonating IRS officials – in person, over the telephone and via email. Don’t get scammed. The IRS wants you to understand how and when the IRS contacts taxpayers and help you determine whether a contact you may have received is truly from an IRS employee.The IRS initiates most contacts through regular mail delivered by the United States Postal Service.However, there are special circumstances in which the IRS will call or come to a home or business, such as when a taxpayer has an overdue tax bill, to secure a delinquent tax return or a delinquent employment tax payment, or to tour a business as part of an audit or during criminal investigations 

 Even then, taxpayers will generally first receive several letters (called “notices”) from the IRS in the mail. 

 The IRS does not:

• Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes.
  
  
• Demand that you pay taxes without the opportunity to question or appeal the amount they say you owe. You should also be advised of your rights as a taxpayer.
  
  
• Threaten to bring in local police, immigration officers or other law-enforcement to have you arrested for not paying. The IRS also cannot revoke your driver’s license, business licenses, or immigration status. Threats like these are common tactics scam artists use to trick victims into buying into their schemes.

Awesome Tax Tool - Click here

Withholding Calculator