Tax rates are changing in 2018. Whether you’re a small business owner or a dedicated employee working to support the family, it’s important to be prepared for changing rules and regulations. Below, the team at The Callen Accounting Group, PLLC in Mountain Home, AR, shares a brief overview of this year’s changes to help keep you up-to-date.

3 Details to Know About the New Tax Code

Tax Brackets Are Largely the Same

Just as in 2017, there are seven tax brackets, each with a different rate based on total taxable income earned. For individuals earning under $9,525, there’s a 10% rate. However, for individuals making over $500,000, the rate is $150,689.50 plus 37% of the amount of money earned over $500,000. Your tax accountant can help you prepare for the proper rate and can help maximize deductions throughout the year.

Tax Rates for Trusts & Estates Have Changed

Trusts and estates are great ways to keep money safe for your family and beneficiaries, but the rates surrounding that income have changed. Taxable income below $2,550 is subject to a 10% rate. As income grows, you can expect the rate to increase as well; the top rate this year is $3,011.50 plus 37% of taxable income over $12,500. When estimating tax liability, take into consideration the estate and trust rates in addition to standard income tax rates.

Standard Deductions Have Increased

The good news with the 2018 changes is the increase in standard deductions. For single individuals or married couples filing separately, the deduction increases from $6,350 to $12,000, greatly reducing tax liability for most individuals. For married couples filing jointly, the deduction increases to $24,000. This will make filing your tax return a bit easier and helps increase the amount you’ll get as a tax refund. 

Understanding the details of this year’s tax rates can be confusing, but you don’t have to go through it alone. Instead, let an experienced accountant at The Callen Accounting Group, PLLC help you prepare and file your taxes. They’ll work to help maximize deductions and get you the best return possible. Learn more about their services online or call (870) 425-6066 to schedule a consultation.