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DWM Tax Service

4522 Old Burlington Rd.

Greensboro, NC 27405

Telephone: 336.621.4885 Email: dwmtax@gmail.com

Big year election wise.  Not so big tax wise.  Congress didn’t do much except draw a salary.  It’s slso difficult to know how many changes may be made at this point that will effect next years taxes.  The president has proposed tax cuts for all.  The reality is that most people will get about a 1 or 2 percent reduction.  The top brackets will get abut 15%.  People who have children may see a tax increase of 1 or 2 percent (about a $1000).  That is assuming that his proposals pass congress, which is likely.

Obamacare remains the law of the land and penalties will increase again for not having insurance.  As I’ve pointed out before there are exceptions available to get around this.  One is a medical expense sharing plan.  These are usually Christian non profits made up of people who get together for the purpose of sharing medical costs.  They can be much cheaper than insurance.  The largest one is Medi-share, another is  Samaritan Ministries.  These are not guaranteed, but do appear to be reputable and can give you an out from paying penalties and being tied to the insurance Exchange.  Another out is to join a church that doesn’t believe in insurance.  Trump says he will only support the repeal of Obamacare, if he can find something with lower costs and better coverage.  He may find that impossible to do unless he proposes a single payer system.  The Republicans in Congress are all for repeal but admit that any repeal probably won’t take effect for three years.  By that time you will be paying penalties equal to the cost of health insurance without getting anything for the money. It is important to ignore their posturing and go ahead and find some kind of coverage or take advantage of one of the allowed exemptions.

Tax laws are basically the same this year.  There have been adjustments as usual to limits and so forth based on inflation.  Mileage rate for business .54 for 2016 and drop to .535 for 2017.  .19 for medical and moving dropping to .17 in 2017.  

The IRS plans again to delay the start of tax season to January 23. No returns can be processed before that date.  If you have your materials in hand before that time we can go ahead and do your return and put it in the queue to be processed on that date.  They also will not pay any refund involving earned income credit or additional child tax credit until after the 15th of February, that I can’t help with.  So if you’re counting on getting that big refund really fast, don’t.  This is primarily an attempt to cut down on fraud and identity theft. Charitable mileage is .14 and remains there for 2017.

Some extensions worth noting:

    A permanent extension of the general state and local sales tax deduction.

    A permanent extension of the $250 educator expense deduction.

    An extension of the tuition and fees deduction through 2016.

    An extension of the nonbusiness energy credit through 2016.

    An extension of mortgage insurance premiums paid or accrued as an itemized deduction through 2016.

    An extension of the qualified principal residence indebtedness exclusion for debt discharge income through 2016.

Information returns w-2 and 1099 are due by Jan 31 this year.  The old deadline was was Feb 28.  There is a $250 per form penalty for filing late.