With the GOP Tax cuts & Jobs Act, several deductions could be eliminated. 2017 might be your last opportunity to take advantage of those deductions.

Individuals might want to consider to:

  • Pay early property tax in 2017 if, and only if, your property taxes for 2018 has been assessed. The bill caps it at $10,000.00 in 2018.
  • Pay early State and local taxes if possible.
  • Pay large medical expenses before Year end. The new lower threshold 7.5% AGI is available retroactively to 2017.
  • Buy a plug-in electric vehicle before the end of the year to benefit from the $2,500 credit. The Tax cuts & Jobs Act would eliminate this credit. Although the repeal could be retroactive based on the mark ups discussion.
  • If you intend to move for work reasons, do it before December 31. The bill  eliminates the moving expenses deduction.
  • Review your IRA conversion.
  • Harvest stock losses. Under the proposed changes, an investor would have to sell the oldest stock first (first in first out).
  • Increase your charitable donations if your itemized deductions math works.
  • Delay income until 2018.

Businesses might want to consider to:

  • Benefit from all the Business credits still available in 2017. Most of them could be repealed.
  • Use their NOL carryback if they have prior year profits.
  • Delay buying equipment until 2018 to benefit from full “expensing” in 2018.

To be continued as new information emerge from The White House and/or Congress.

I created this blog to help understand certain basic aspects of proposed U.S. tax reforms. Of course, the discussion between Congress and the White House is ongoing and many things could change before the propositions are finalized into laws.
 

Please do not hesitate to contact me should you have any question