to the tax brackets being lowered, the standard deduction has been doubled. You ask what does this mean in the most simplistic terms. Well, I’m here to help.
Let’s start with standard deductions. A standard deduction essentially means “x” amount will be deducted from your taxable income which will ultimately decrease your tax liability (what you owe Uncle Sam). For single filers, the standard deduction has increased from $6,350 to $12,000; for married couples filing jointly, it’s increased from $12,700 to $24,000.
The ultimate goal of this is to encourage more people to take the standard deduction as opposed to an itemized return, but that’s an entirely different article. As far as standard deduction goes, with this increase, we owe less money and when you owe less you gain more.
Additionally, the lowering of the tax rates mean that most working and middle-class black people who take the standard deduction will not only see a decrease in tax liability because of that, they will also be taxed at a lower rate. This can be a huge win depending on how you file your taxes. With that said, we can all expect an increase in our coins reflected in our February 2018 paychecks.
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2. The child care tax credit has been doubled.
Now, this topic is one that has been very controversial for many reasons of which I will not jump into today. What I will say is what this could potentially mean for those of us with dependent children under 17 years old. The childcare credit has increased from
