2018 ushered in some of the most dramatic changes to the tax code in decades, affecting how almost everyone calculates and pays their taxes. Before starting your tax preparation, it’s important to know how the numerous updates to the code can impact your obligations and deductions. Below are some of the most important tips to keep in mind when preparing your 2018 taxes.

A Guide to Saving on Your 2018 Taxes

1. Approach With Fresh Eyes

If your financial situation hasn’t changed, you may assume that you qualify for all the same deductions and tax credits you got last year. However, the qualification criteria for many of these have changed, while other deductions have been eliminated entirely. When starting your tax preparation, approach the process with fresh eyes.

2. Adjust Your Withholding

Changes to the tax brackets mean lower withholding for many taxpayers, so you might get a bigger refund than expected this season. If you get more back than usual, adjust your withholding amount so that you can enjoy higher paychecks throughout the year.

3. Check Your Deduction Amounts

The Tax Cuts and Jobs Act nearly doubled the standard deduction, so many taxpayers who used to itemize will no longer have to. However, before deciding which deduction to take, take the time to add up your deductible expenses to ensure taking the standard one is the best approach.

4. Look Into New State Laws

Each state has its own taxation system that may not follow the changes in federal law. When preparing your taxes, pay special attention to your state returns to avoid expensive fees and penalties.

5. Start Tax Preparation Early

All the updates to the code are likely to cause confusion, and may present problems you have not experienced before. Starting your tax preparation early will give you time to pay if you have an unexpected liability and correct any issues before penalties kick in.

Tax preparation is almost always complex and confusing, but a skilled professional can provide the insight you need. Bergamo Tax & Financial Solutions offers high-quality financial advice to individuals and businesses throughout Watertown, CT, as well as Middlebury, Waterbury, and Litchfield. Visit their website for updated tax resources, get more tips and advice on Facebook, or call (860) 274-1655 to schedule an initial appointment.