How President Trump's Tax Changes Will Impact You - NBC 5 Dallas-Fort Worth
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How President Trump's Tax Changes Will Impact You

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    How President Trump's Tax Changes Will Impact You

    While most people are busy finalizing their 2017 taxes, there are some major changes on the horizon for 2018. (Published Tuesday, April 10, 2018)

    After December 31, 2018, the deduction for moving expenses has moved on. The cost of moving your stuff to a new house, and the money you spent finding that house, can no longer be deducted unless you're an active duty member of the armed forces. The deduction disappears even if you're moving for a new job.

    "Within Texas a move can range from $2,000 up to $5,000," said Elle Nesher of Element Moving and Storage.

    She doesn't think it will effect her business. "People still have to move. I doubt people are going to reject a job offer or a better opportunity just because they can't expense their taxes. They'll just be a bit more price conscious of what they spend because now they are paying for it out-of-pocket and it's not going to be tax-deductible." said Nesher.

    If a person had a $5,000 move in 2017, they'd be able to deduct $5,000 of eligible expenses. After 2018, none of that money can be deducted.

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    The next fiscal year also brings with it a huge change in alimony payments. While they have never been guaranteed in Texas, the clock is ticking on if they can be deducted.

    "I think what you're going to see is more of a rush of people who are already in the middle of a divorce or already separated saying we need to close this out," said Robert Epstein, a partner with the McClure Law Group.

    He says if you file for divorce after December 31, 2018, the ex-spouse *paying* the alimony can no longer deduct it. The ex-spouse *receiving* the alimony won't have to pay taxes on it. McClure said a client he does not represent already agreed to pay his client more, just to end the divorce before the changes. "That's kind of unique, because a lot of times people aren't willing to say 'yeah I'll agree to alimony,' at least not without being very very close to having a settlement agreement in place. In this particular case I wouldn't exactly say were close."

    Here is a very basic example. An ex-spouse making $100,000 this year would pay about $20,000 in alimony. Out-of-pocket, after deductions, that would be $16,000. After the tax changes go into effect, he says the ex-spouse may argue they can only afford $16,000 in payments. So the recipient would go from receiving $20,000 in 2017 to $16,000.

    Deductions for small businesses like Maco Amoyo's will also see a big change. He and his younger brother started their printing business called "Bullet Graphics Center" 33 years ago.

    Under Trumps tax plan for 2018, he will qualify for a "pass thru deduction." It's called pass thru because it applies to small businesses where money "passes thru" to the individuals tax return. If a business qualifies, it will automatically get a 20 percent deduction. In real numbers that means if is a businesses' income is $100,000 a year, the IRS will only tax it on $80,000. When Amoyo first heard the change, he thought it was a mistake.

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    "Not until I heard it from my accountant did I really believe that 'hey we're going to really get a good tax break this year.'" Amoyo says he's gonna grow his business with the extra money.

    If you would like to know how your taxes could be affected by next years changes- click here.

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