Tax Law Changes That Families Need To Know for 2018

2018 brings us new tax laws. Our helpful site sponsor, Lauren Hunt from Pinnacle Financial Group, wants to keep us all current so we can do what’s best for our families! Here are few things that she believes every family should consider under these new rules.  As always, please reach out if you have any questions – lauren@mypinnaclefinancial.com.

Tax Law Changes for 2018

Changes for 529 Plans

529 savings can now be used for K-12 tuition and not just post-secondary qualified expenses.   The website Savingforcollege.com put out a nice article summarizing what is a qualified 529 expense.

Increase in Standard Deduction

The new tax law doubled the standard deduction (now $12,000 for individuals and $24,000 for married filing joint returns) and eliminated personal exemptions.  The expectation is that more families will take the standard deduction instead of itemizing their tax returns. When you meet with your accountant to file your 2017 taxes it would be worth your time to ask what this change means for your family.

Mortgage Interest Deduction Decrease

Two other reasons more people are expected to take advantage of the new higher standard deductions is that the current law reduced the cap on mortgage interest that is deductible from a first or second home at $750,000 – down from $1,00,000.  The bill also caps the deduction for state and local taxes at $10,000.

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Estate Tax Exemption Increase

The estate tax exemption was increased to $11.2 million per person.  This means that married couples have an exemption up to $22.4 million and that limit will be adjusted for inflation until the end of 2025, when the increase expires.  At the end of 2025 the estate tax exemptions will return to the 2017 limits plus inflation.  These new significantly higher estate tax limits make it a good time to review your estate planning documents.

Have Questions?

Financial Planners and Wealth Advisors are not just for those thinking about or entering retirement.  A good planner can help take something off your plate no matter what phase of life you are in!

Lauren Hunt, CFP® is a Wealth Manager at Pinnacle Financial Group in downtown Western Springs. She is very approachable, knowledgable, and loves working with young families! It’s great to have someone to bounce ideas off of and get financial guidance from, so if you don’t have someone to talk to, definitely give Lauren a call at (708) 246-6262 or email her at lauren@mypinnaclefinancial.com.

You can also get more insight in this article, Are We On Track?, with answers to questions like, Are you saving enough to cover the cost of college? Do you know your household net worth so you can see how you are doing from year to year? How should you plan for retirement?

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About the Author

Annie Tandy
Annie loves making great memories with her kids and started Kidlist in 2011 so she can help others do the same! Besides finding fun and exciting things to do, Annie and her kids enjoy caring for their chickens and hanging out with them in the backyard. Click here to read about Annie's chickens and see pictures! She also finds joy in gardening, home improvement projects, knitting, soap making, and painting along with being active in her community, church, and as a board member of the Western Springs Business Association. Click here to follow Annie on Instagram.

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