Page 4 - Tax_Law.pdf

Americans won't need to worry about
these changes when they start filing their
2017 tax returns in about a month. The
new laws will first be applied to 2018
taxes.
By the way, you can still deduct
student loan interest.
The deduction for student loan interest,
which is up to $2,500 per year, is safe.
You can still deduct medical
expenses.
The deduction for medical expenses
wasn't cut. In fact, it's been expanded for
two years. In that time, filers can deduct
medical expenses that add up to more
than 7.5% of adjusted gross income. In
the past, the threshold for most Americans
was 10% of adjusted gross income.
If you're a teacher, you can still
deduct classroom supplies.
The deduction for teachers who spend
their own money on school supplies was
left alone. Educators can continue to
deduct up to $250 to offset what they
spend on classroom materials.
The electric car tax credit lives on.
Drivers of plug-in electric vehicles can still
claim a credit of up to $7,500. Just as
before, the full amount is good only on the
first 200,000 electric cars sold by each
automaker. GM, Nissan and Tesla are
expected to reach that number some time
next year.
Home sellers who turn a profit keep
their tax break.
Homeowners who sell their house for a
gain will still be able to exclude up to
$500,000 (or $250,000 for single filers)
from capital gains, so long as they're
selling their primary home and have lived
there for two of the past five years.
529 savings accounts can be used in
new ways.
In the past, funds invested in 529 savings
accounts wasn't taxed -- but it could only
be used for college expenses. Now, up to
$10,000 can be distributed annually to
cover the cost of sending a child to a
"public, private or religious elementary or
secondary school." This change is a win
for Education Secretary Betsy DeVos.
And tuition waivers for grad students
remain tax-free.
Graduate students still won't have to pay
income taxes on the tuition waiver they get
from their schools. Such waivers are
typically awarded to teaching and
research assistants.