FAQ

What is The Tax Cuts and Jobs Act (TCJA)?

The Tax Cuts and Jobs Act (TCJA), passed in December 2017, made changes that affect all kinds of taxes - individual, business, estate and even tax exempt organizations and government entities. Most changes from the TCJA took effect on January 1, 2018 and are slated to sunset after December 31, 2025. However, there are a few provisions from the new tax law that have a 2019 effective date and some are retroactive.

Tax Reform: Basics for Individuals and Families
Tax Reform Provisions that Affect Individuals
Tax Reform: What's New for Your Business
Tax Reform Provisions that Affect Businesses

What is a Tax Deduction?

Tax deductions are used to lower your taxable income, effectively lowering the amount of tax you have to pay.

Standard Tax Deduction

The standard deduction amount varies depending on your income, age, and filing status. For the tax year, the standard deduction for most people is:

• Single or Married filing separately - $12,000 (up from $6350)
• Married filing jointly or Qualifying widow(er) - $24,000 (up from $12,700)
• Head of household - $18,000 (up from $9,350)

Itemized Tax Deductions

To take advantage of itemized tax deductions you will have to file a form 1040 with a Schedule A, which has its own limitations. We can help you determine if you can benefit from filing an itemized return.

The most common types of itemized tax deductions include mortgage interest, qualifying medical expenses, property taxes, and charitable contributions.

What is a tax credit?

Where tax deductions are used to lower your taxable income, tax credits work by directly reducing the amount of tax you have to pay. You are probably already familiar with popular tax credits like Earned Income Tax Credit (EITC), American Opportunity Credit, and Child Tax Credit.

You can take tax credits whether you itemize or not, but there are limitations. We will help find which tax credits are relevant to your circumstances and ensure you get the best possible refund.

Refundable Tax Credits

A refundable tax credit works even if you don't have any tax liability, that is, even if your total tax due is $0.

Non-refundable Tax Credits

Non-refundable tax credits are good because they have the ability to reduce the amount of tax you owe to nothing. They are limited in that the amount of credits can't exceed the amount of tax you owe.

Who can I claim as a dependent?

The IRS rules define two types of dependents, each subject to different rules:

• A qualifying child
• A qualifying relative

How fast can I expect to get my refund?

How fast you get your federal tax refund depends on how you file your return. The fastest method is to e-file. Taxpayers who e-file a tax return in January or February generally get a refund within a couple of weeks. Tax returns that are mailed take considerably longer to process and prolong the amount of time it takes to receive a refund.

If you claim the Earned Income Credit or Additional Child Tax Credit the IRS will not issue refunds before mid-February.

For the most up to date information about your federal tax refund, check out the IRS "Where's My Refund" tool.

For the most up to date information about your State of Utah tax refund, check out the UTAH "Where's my Refund" tool.

What is the Federal Tax Rate?

This questions is actually quite complex. The federal tax rate is based on your filing status, how much money you made during the year, the source of your income and other related factors.

How do I file an extension?

The IRS and the Utah State Tax Commission allow taxpayers to file extensions. This allows you more time to file your tax return. It does not, however, give you an extension of time to pay your tax bill.

You can apply for an automatic 6-month extension by filing IRS Form 4868. This form can be mailed in, or submitted via e-file. You can submit this form with payment for your Federal income tax due in order to alleviate the late payment penalty and interest.

The Utah tax extension is automatic. That means there is no official application or written request to submit as long as you don't owe Utah state taxes. Utah's extension form TC-546 is used if you need to make an payment for your Utah income tax due in order to alleviate the late payment penalty and interest.