OKLAHOMA CITY – With the partial government shutdown, and new tax law on the books, some taxpayers are concerned about seeing a smaller refund, or even no refund at all.
Change is a brewing for Dan Myers this tax season.
He and his wife are in the process of switching accountants, plus he purchased a new business, plus has real estate income, a mortgage, and 5 kids at home.
Like most Oklahomans, with the sweeping tax overhaul, he’s curious to know if he’s going to owe more or less to the federal government this time around.
“The government shutdown gave me some anxiety on all fronts,” he said. “Not sure [if I’ll pay more] with the purchase of a company.
Joshua Jenson of Jenson & Company, CPAs, says he doesn’t see people paying more in tax under the new tax law and for small business owners none of the tax laws changed, but Congress did implement a new tax cut, which might complicate things.
He said, “So if you have a small business owner and they net a $100,000, potentially 20% of that won’t be taxable.
That’s potentially a big deal, if you qualify.
If you don’t meet the criteria you can’t take the deduction.
While the average Joe taxpayer isn’t guaranteed to save on taxes.
Jenson says the IRS did simplify things, nearly doubling the standard deduction.
“Overall 98% of our clients will pay less taxes in 2018 regardless of their income to the tune of $3 to $8,000 on average.
Here’s the trade-off.
The new law gets rid of miscellaneous itemized deductions, basically anything related to your job that you’ve been able to expense in the past, like travel expenses, work-related mileage or out of pocket classroom expenses for teachers. Those are all gone!
Jenson added, “Again, it may be on the front side, ‘Oh my gosh I just lost these deductions,’ but on the backside, your standard deduction being that much higher.”
One more important point and it’s a double-whammy.
Since the federal tax law changed Oklahoma must follow suit, meaning Oklahomans likely won’t see as many deductions on their state tax return either.
The In Your Corner bottom line is filing electronically and using direct deposit is going to be the fastest way for you to get your refund.
The IRS tells me they are full steam ahead and expects the first refunds to go out the first week of February.
In spite of the shutdown, Jensen doesn’t expect a delay in refunds either.
IRS.gov includes a bunch of resources for taxpayers.
Check out Joshua Jenson’s YouTube Channel.