Losing the $4,050 Personal Exemption in 2018 But Doubling The Standard Deduction

7 comments

As part of the GOP tax reform bill to support President Trump’s tax reform agenda the Personal exemption is being fully eliminated in 2018. The $4,050 personal exemption in 2018 (which was unchanged from 2017) can be taken for yourself, your spouse, and your eligible dependents, will be scrapped. This could mean that single parents or families with lots of dependents could see a higher tax bill as a result, while higher income filers with no kids/dependents will likely fare much better due to their ineligibility for this exemption (income limits) under current law and from the other offsetting tax breaks in the new tax bill.


Several itemized deductions like SALT and alimony payments are also being cut back or eliminated entirely. This is supposed to be offset by the near doubling of the standard deduction, higher income 2018 tax bracket thresholds and increased Child Tax Credit (CTC). The idea is that by increasing the standard deduction and removing several deductions and the personal exemption, tax payers will not need to itemize for claiming extra deductions in their 2018-19 tax returns thereby making the tax filing process simpler and smoother.

Note that the personal exemption was not able to be permanently scrapped by the GOP due to Senate rules but will be suspended until 2025, unless extended by Congress then.

{ 7 comments… read them below or add one }

Katie January 9

I’m at about 15,000 in itemized deductions including SALT (just under 10K), mortgage interest, donations. I do not have kids. Unless the tax brackets are going to wildly help me I don’t see how losing the personal exemption won’t leave me paying *more* in taxes in the end.

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Anthony Walker January 9

I can’t see how losing the exemption deduction and getting a 10K addditional allowance for the standard deduction will help anyone but the 2 person family. If they itemized they will get murdered with a straight loss of the number of exemptions allowed. a family of four would have to pay tax on $16,200 , how is that a tax break. If they have removed the exemption deduction it will suck for a lot of the middle class. I can see why the democrats say this law is crap but they agreed to it because it will kill Trump and the Republicans at the polls.

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Robert Simon January 8

The bottom line is no group should not have to subsidize large families. If u do not want to pay more in taxes stop having multiple children and be responsible
Nobody is stopping u from having a large family just no tax benefits for doing so

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Sharon December 28

The current tax law states an individual can be claimed by the taxpayer if the taxpayer providers more than 50% of the individual’s support AND the individual earns less than the standard exemption amount ($4,050). What will the new amount to be able to claim an individual who resides with you and is supported over 50% by you?

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sestamibi December 26

Adolph, the loss of the personal exemption is offset by an increase in the child tax credit to $2000, so many of the single-parent families of which you speak should make out all right after all.

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Adolph December 21

With so many single parent families today, the chance that they might be paying a higher tax bill hardly seems to be a good thing. With the hoops that many jump through to make ends meet, it doesn’t seem
reasonable that to “make it easier to file” would be a choice made if it meant higher taxes. A strong family
has always been the underpinning of a strong country, yet this does not seem to help many families. Considering the falling birth rate, large families are an asset to the country.

“This could mean that single parents or families with lots of dependents could see a higher tax bill as a result, while higher income filers with no kids/dependents will likely fare much better due to their ineligibility for this exemption (income limits) under current law and from the other offsetting tax breaks in the new tax bill.

This part of the bill is a big mistake if I understand what has been described in the paragraph. I hope there
is some way that these families have some way to work around that increase.

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Brian December 20

Considering that currently about 72% of taxpayers file using the standard deduction, the near-doubling of the standard deduction, adjustments to the tax brackets, and doubling of the child tax credits in the GOP proposal will benefit many of that remaining 28% who do currently itemize. We’ve actually entered the numbers to see how it turns out for specific taxpayers — It’s difficult to come to any conclusion about the impact to a taxpayer without actually entering the data and seeing how it calculates out.

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