December is the time of year when many Massachusetts residents give their first thoughts to the coming tax season. While many are only thinking about their 2018 tax liabilities, the IRS is already releasing information about 2019. Having this information should help many people make better financial decisions for the coming year.
The information includes new income tax brackets for the 2019 tax year that include adjustments for inflation. The standard deductions will also see a slight increase. Single filers get a $200 increase, married couples filing jointly get a $400 increase, and heads of household get a $350 increase. This may not seem like much, but every dollar counts when taxpayers are doing their best not to pay any more in taxes than necessary.
Massachusetts residents will also get to contribute more to their retirement funds without tax in 2019. The increase for most employment plans and IRAs will be $500. Other contribution limits may remain the same or increase depending on the plan. The penalty for not carrying health insurance for all 12 months of the year also goes away in 2019. However, the penalty could still apply for the 2018 tax year, and it could be a hefty sum depending on the family.
These are just some of the changes the IRS made for the 2019 tax year. In order to make the most of these changes, it may be beneficial to discuss your current situation with an experienced tax attorney. In addition, should you have any issues arising during the 2018 tax year, he or she could help with those issues as well.