We keep track of all the tax law changes so you don't have to. TaxAct 2017 federal and state products have all the latest tax law changes to help you get your maximum guaranteed refund the fastest way possible!

Employees

The maximum amount of earned income on which you pay Social Security tax is now $127,200. When you reach that amount with one employer, they should stop withholding Social Security tax from your pay until the following year. If you work for more than one employer, and your total earnings are more than $127,200, TaxAct calculates a credit for any overpayment of Social Security taxes.

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If you qualify, you can exclude up to $102,100 of your foreign earned income from your taxable income for 2017. If you and your spouse both work in separate foreign countries and meet the qualifications, you may each be able to exclude up to $102,100.

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Families

You may qualify for a credit equal to up to $13,570 of your adoption expenses. If your employer provides adoption benefits, you may also be able to exclude up to the same amount from your income. Both a credit and exclusion may be claimed for the same adoption, but not for the same expense. The credit is permanent and indexed to inflation.

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If you claim the Child Tax Credit in 2017, be prepared to wait a bit longer for your refund. By law, the IRS cannot begin issuing refunds for 2017 returns claiming the Child Tax Credit until February 18, 2018. To further combat potential fraud, taxpayers who claim the Child Tax Credit incorrectly may not be able to claim the credit again for 2-10 years.

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Homeowners

If you were one of the many Americans affected by hurricanes or wildfires in 2017, the IRS may be able to help. Visit the IRS Guidance for Those Affected by Disasters page to see if you qualify.

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Everyone

The filing deadline for individual income tax returns has been extended to April 17, 2018 due to the Emancipation Day holiday.

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Most tax provisions are considered permanent unless specifically repealed; however, there is a group of tax credits knows as "The Extenders" that have specific expiration dates. Those set to expire at the end of 2017 still stand a good chance of getting extended, assuming pending legislation is approved. Some of those tax breaks include:

  • Mortgage premium insurance deduction
  • Tuition and fees deduction
  • Indian employment tax credit
  • Credit for construction of new energy efficient homes
  • Mortgage debt relief exclusion
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The standard amount you can deduct from income if you don't itemize your deductions is $6,350 ($12,700 for married couples filing jointly, or $9,350 if you file as head of household).

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The personal exemption for 2017 remains $4,050, though it now phases out at $384,000 ($436, 300 for married couples filing jointly).

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The Alternative Minimum Tax (AMT) exemption amount for individuals rises in 2017 to $54,300 and begins to phase out at $120, 700. For married couples filing jointly, the exemption rises to ($84,500, with phase-out beginning at $160, 900 for married couples filing jointly). A taxable income above $187, 800 ($93,900 for married filing jointly) will land you in the 28 percent tax rate.

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If you have no children, your maximum Earned Income Credit for 2017 is $510. With two children, the maximum amount is $5,616, and with one child, it is $3,400. If you have three or more qualifying children, the maximum Credit you can receive for 2017 is $6,318 (up from $6,269 in 2016).

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Education & College

You may be able to exclude all or part of the interest from qualifying Series EE or Series I bonds if you use the income for qualified educational expenses. You cannot take this benefit if your modified adjusted gross income is $93,150 or more ($147,250 if you file jointly, or if you file as Qualifying Widow(er) with Dependent Child).

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The American Opportunity Tax Credit income limits remain unchanged for 2017. You can claim the this benefit even if the student doesn't receive Form 1098-T from the education institution. Make sure to have your TIN ready by the time you file - you can't claim the credit without it.

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Health care

In 2017, each individual taxpayer must still carry the required "minimum essential coverage" each month, qualify for an exemption, or pay mandatory taxes. The minimum amount of insurance coverage you must carry is calculated per family member and then added together. The fee for not having health insurance is the higher between 2.5% of household income or $695 per adult ($347.50 per child under 18, with a maximum of $2085 per family).

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Taxpayers over the age of 65 can deduct medical expenses that exceed 10 percent of their AGI, down from 7.5 percent of AGI in 2016.

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High-income households

If you have a high adjusted gross income, you may not be able to take all your itemized deductions, thanks to the Pease provision. Itemized deductions start to phase out at $156,900 if you are married filing separately ($261,500 for individuals, $287,650 if head of household, or $311,800 if filing jointly). Your itemized deductions are reduced by 3% of your adjusted gross income over these amounts, but they are never reduced by more than 80% of your otherwise allowable deductions.

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Your personal exemptions for yourself, your spouse, and your dependents reduce your taxable income by $4,050 each. If your adjusted gross income is over $261,500 ($156,900 if married filing separately, $313,800 if filing jointly, or $287,650 if filing as head of household), your personal exemptions are reduced by 2% for each $2,500 or portion over these amounts. The exemption phases out completely at $384,000 ($436,300 if filing jointly, $218,150 if filing separately, $410,150 if filing as head of household).

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For persons who died in 2017, the federal estate tax rate remains at 40%. This tax only applies to estates larger than $5,490,000 - up from $5,450,000 in 2016.

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Miscellaneous

The standard mileage rate for the use of your car or other vehicle drops to 53.5 cents per mile for business (down from 54 cents for 2016) and down to 17 cents per mile driven for medical or moving purposes (down from 19 cents for 2016). The rate for charitable travel remained the same at 14 cents per mile.

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The most you can contribute to one of these plans increases to $2,600. Your spouse can also contribute $2,600 if he or she meets the qualifications. For certain FSAs, up to $500 can now be carried over to the next year.

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(1) Self-only coverage. The term "high deductible health plan" as defined in Sec. 220(c)(2)(A) means, for self-only coverage, a health plan that has an annual deductible that is not less than $1,300 and not more than $3,400, and under which the annual out-of-pocket expenses required to be paid (other than for premiums) for covered benefits do not exceed $6,550.

(2) Family coverage. The term "high deductible health plan" means, for family coverage, a health plan that has an annual deductible that is not less than $2,600 and not more than $6,750, and under which the annual out-of-pocket expenses required to be paid (other than for premiums) for covered benefits do not exceed $13,100.

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January 2018
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Upcoming Tax Dates

January 1 — Everyone
Federal Holiday (New Year's Day) Details

January 10 — Employees who work for tips
If you received $20 or more in tips during December, report them to your employer Details

January 15 — Individuals
Make a payment of your estimated tax for 2017 if you did not pay your income tax for the year through withholding (or did not pay in enough tax that way). Use Form 1040-ES Details

January 15 — Social security, Medicare, and withheld income tax
If the monthly deposit rule applies, deposit the tax for payments in 12-2017

January 15 — Everyone
Federal Holiday (Birthday of Martin Luther King, Jr./Inauguration Day) Details

January 15 — Farmers & fishermen
Pay your estimated tax for 2017 using Form 1040-ES Details

January 31 — All Employers
Give your employees their copies of Form W2 for 2017. If an employee agreed to receive Form W2 electronically, have it posted on a website and notify the employee of the posting.

January 31 — Individuals who must make estimated tax payments
If you did not pay your last installment of estimated tax by 01-15, you may choose (but are not required) to file your income tax return (Form 1040) for 2017 by 01-31. Filing your return and paying any tax due by 01-31 prevents any penalty for late payment of the last installment. If you cannot file and pay your tax by 01-31file and pay your tax by 04-15.

January 31 — Payers of gambling winnings
If you either paid reportable gambling winnings or withheld income tax from gambling winnings, give the winners their copies of Form W2G.

January 31 — Social Security, Medicare, and withheld income tax
File Form 941 for the fourth quarter of 2017. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the quarter timely, properly, and in full, you have until 02-10 to file the return.

January 31 — Certain small employers
File Form 944 to report social security and Medicare taxes and withheld income tax for 2017. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is $2,500 or more for 2017 but less than $2,500 for the fourth quarter, deposit any undeposited tax or pay it in full with a timely filed return. If you deposited the tax for the year timely, properly, and in full, you have until 02-10 to file the return.

January 31 — Farm employers
File Form 943 to report social security and Medicare taxes and withheld income tax for 2017. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the year timely, properly, and in full, you have until 02-10 to file the return.

January 31 — Federal unemployment tax
File Form 940 for 2017. If your undeposited tax is $500 or less, you can either pay it with your return or deposit it. If it is more than $500, you must deposit it. However, if you deposited the tax for the year timely, properly, and in full, you have until 02-10 to file the return.

January 31 — All businesses
Give annual information statements to recipients of certain payments you made during 2017 Details

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