With April 15th coming up fast it might be a good time to look at some of the changes applicable to your 2019 federal tax return. Compared to prior years, there are relatively few changes for individual taxpayers:
Standard Deduction Increase. For 2019 the standard deduction is increased as follows:
Single/Married Filing Separately $12,200
Married Filing Jointly/Qualifying Widower $24,400
Head of Household $18,350
It is worth observing that roughly 10% of taxpayers itemized for 2018, which was down from 30% in prior years. This is no doubt caused by the significant increase in the value of the standard deduction and the elimination or capping of some of the popular individual deductions.
New Divorces. For divorces and separation agreements finalized after 2018, alimony payments are not deductible for the payor or included in the recipient’s income. Divorces finalized before 2019 remain subject to the former rule which allows a deduction by the payor and requires income to be reported by the recipient.
No Health Insurance Penalty. The penalty for not maintaining required health insurance has been effectively eliminated for 2019 taxes.
New Form 1040SR. For those taxpayers 65 and over, the IRS has come up with a new tax form having larger print and better color contrast.