For the 2019 tax year, the adjusted gross income amount used by joint filers to determine the reduction in the Lifetime Learning Credit is $116,000, up from $114,000 for tax year 2018. Phaseouts apply for taxpayers with MAGI more than $70,000 ($140,000 for joint returns) and the deduction is completely phased out for taxpayers with MAGI of $85,000 or more ($170,000 or more for joint returns). For 2019, the maximum amount that you can deduct for interest paid on student loans remains $2,500. Student Loan Interest Deduction. Like the adoption credit, there were rumors that the student loan interest deduction had been shuttered: it was not.For 2019, the credit allowed for an adoption of a child with special needs is $14,080, and the maximum credit allowed for other adoptions is the amount of qualified adoption expenses up to $13,810. Adoption Credit. Despite rumors of the death of the adoption credit, it’s still in place.You can check out Revenue Procedure 2018-57 (downloads as a pdf) for a table providing maximum credit amounts for other categories, income thresholds, and phaseouts. Earned Income Tax Credit (EITC). For 2019, the maximum EITC amount available is $6,557 for married taxpayers filing jointly who have three or more qualifying children.For more about the expanded CTC, click here. Phaseouts, which are not indexed for inflation, will begin with adjusted gross income (AGI) of more than $400,000 for married taxpayers filing jointly and more than $200,000 for all other taxpayers. The bill also includes a temporary $500 nonrefundable credit for other qualifying dependents. The child tax credit has been expanded to $2,000 per qualifying child and is refundable up to $1,400, subject to phaseouts. Here's a look at a few of the most popular: Some additional tax credits and deductions were adjusted for 2019 or changed under the tax reform law. (For more on changes to Schedule A, click here.) Don Pease (D-OH) used to cap or phase out certain deductions. For high-income taxpayers who itemize their deductions, the Pease limitations, named after former Rep.Job Expenses and Miscellaneous Deductions subject to 2% floor. Miscellaneous deductions, including unreimbursed employee expenses and tax preparation expenses, which exceed 2% of your AGI have been eliminated.For more on casualty losses after a disaster, click here. Casualty and Theft Losses. The deduction for personal casualty and theft losses is repealed except for losses attributable to a federal disaster area.Charitable donations. As a result of tax reform, the percentage limit for charitable cash donations to public charities increased from 50% to 60% in 2018 and will remain at 60% for 2o19.For more on mortgage interest under the new law, click here. Home Mortgage Interest. You may only deduct interest on acquisition indebtedness - your mortgage used to buy, build or improve your home - up to $750,000 ($375,000 for married taxpayers filing separately).State and Local Taxes. Deductions for state and local sales, income, and property taxes remain in place but are limited to a combined total of $10,000 ($5,000 for married taxpayers filing separately).Medical and Dental Expenses. The 'floor' for medical and dental expenses rises to 10% (it was 7.5% in 2018), which means you can only deduct those expenses which exceed 10% of your AGI.There are changes to itemized deductions found on Schedule A, including: For earned income, the rules are the same as before. Taxable income attributable to net unearned income will be taxed according to the brackets applicable to trusts and estates (see above). Unearned income is income from sources other than wages and salary, like dividends and interest. Total income is made up of six major income classifications: paid employment, pension income, investment income, self-employment income, social benefit payments, and other income.Kiddie Tax. The kiddie tax applies to unearned income for children under the age of 19 and college students under the age of 24. The Canada Revenue Agency determines the classification based on the largest source of income reported on the taxfiler’s individual income tax and benefit return.įor example, if a taxfiler earned a salary but reported more income from investments, this taxfiler was classified as an investor, not as an employee.

Taxfilers do not report their type of work or occupation.

Tax brackets 2019