Business & Finance

Guest Column

2018 Income Tax Filing Season – New Veterans Exemption, Pension Exclusion, and more

8afea91e813e8fabed9c_untitled__15_of_20_-14_pp_11W.jpg
Carletta O. Beckwith, CPA
8afea91e813e8fabed9c_untitled__15_of_20_-14_pp_11W.jpg

Due to the recent tax reform legislation that was passed, it is no surprise that the 2018 Tax Filing season will not begin until January 29, 2018.  According to the IRS, the opening date was set at January 29th, to ensure the readiness of the forms and to evaluate the potential implications of the new tax legislation on 2017 Tax Returns. 

Filing season will begin on January 29th and end on April 17th.  This year taxpayers will have an additional 2 days since April 15th falls on Sunday and Emancipation Day observance is on Monday, April 16th.  Most refunds will continue to be processed within 21 days, provided there are no issues.  As mandated by law, taxpayers receiving the Earned Income Tax Credit (EITC) or the Additional Tax Credit will have to wait until February 27, 2018 to receive a refund. 

For the fastest and most accurate processing, taxpayers are strongly advised to file electronically and opt for direct deposit.  Paper returns could lead to slower processing times and inaccurate processing.  Taxpayers can always check the status of their refunds by visiting the Where’s My Refund Tool on www.irs.gov.

Sign Up for E-News

Just like last year, the IRS continues to work with leading security officials to safeguard taxpayer information and strengthen security protocols as a part of the Security Summit initiative.

As you know, the nation has just received a massive overhaul to the existing tax laws.  One thing is certain and that is the legislation will affect everyone and the laws are currently in effect for 2018, 2019 tax filing season.  Be sure to tune into my next article where I will discuss the impact of the new federal tax reform.

Are you aware that New Jersey’s tax code has some changes this year that are worth highlighting?

Veteran’s Exemption

Taxpayers who were honorably discharged from active service in the Military, Reserves, or National Guard may claim a $3,000 personal exemption for 2017.  This is in addition to all other exemptions claimed.  The exemption can also be claimed by a spouse, if spouse is a Veteran who was honorably discharged from active service in the Military, Reserves, or National Guard. 

The Division of Taxation will require proof of service to claim the exemption.  Veterans are encouraged to certify status and submit the proof prior to filing a return to avoid a delay in processing.  This pre-certification of status can be performed on the Division of Taxation’s website http://www.state.nj.us/treasury/taxation/military/vetexemption.shtml.  Some acceptable forms of documentation include Form DD-214, Form DD-256, or Driver’s License with Veteran Status. 

To certify and provide proof for the exemption, Veterans must complete the Veterans Income Tax Exemption Submission Form which can be found here http://www.state.nj.us/treasury/taxation/military/vetexemption.shtml and forward One form of acceptable documentation by one of the three methods outlined below.

  1. Use Secure Document Upload Feature on Division of Taxation’s website to send Veterans Income Tax Exemption Submission Form and proof of status documentation and enter the notice code VET and select PO Box 440; or
  2. Mail a copy of Veterans Income Tax Exemption Submission Form and proof of status documentation: The New Jersey Division of Taxation, Veteran Exemption, PO Box 440, Trenton, NJ 08646-0440
  3. Fax Veterans Income Tax Exemption Submission Form and proof of status documentation to 609-633-8427

The good news is that once certified, the Veteran will not have to provide proof in subsequent years.

Increase of Pension Exclusion

This year some retirees will get to double the pension exclusion claimed in previous years.  The increase in the pension exclusion is part of a 4-year plan outlined by the Division of Taxation.  Taxpayer must be 62 or older or disabled (per Social Security guidelines) as of last day of the calendar year and income must be $100,000 or less to be eligible.  A single person may exclude $30,000 of pension income in 2017 versus $15,000 in 2016, while a married filing jointly couple may exclude $40,000 in 2017 versus $20,000 in 2016.  Click the link below for chart detailing, in 2020, the exclusion will increase to $75,000 for a single person and $100,000 for married filing jointly couple.

Retirement Income Exclusions for Tax Year 2017 and After

Wounded Warrior Caregiver Credit

This is a refundable tax credit (can reduce tax liability below zero) available to family member caregivers of armed forces with disabilities that stem from service.  Credit will be available for 2018 Tax Year. 

Credit is equal to the lesser of:

  1. 100% of Service Member’s Disability Income OR
  2. $675

Estate Tax

The estate tax exemption has increased from $675K to $2MM in 2016 and 2017 respectively.  As of 2018, the estate tax has been eliminated completely.  Taxpayers can now leave more than $2MM to their heirs and not incur any estate taxes, but will still need to pay inheritance taxes.

Carletta Beckwith CPA LLC is a firm that provides premiere income tax preparation, tax planning, and financial planning services. Carletta Beckwith is a licensed CPA and CFP® and shares her extensive industry knowledge to deliver superior customer service and personalized attention to her clients.  To learn more about the services she provides visit www.beckwithcpa.com.  You may email her directly at carletta@beckwithcpa.com.

IRS Circular 230 disclosure: Any tax advice included in this written or electronic communication was not intended or written to be used, and it cannot be used by the taxpayer, for avoiding any penalties that may be imposed on the taxpayer by any governmental taxing authority or agency. 

Disclaimer: Nothing in this document should be relied on and you should seek professional advice if you need tax information or advice.  This publication should not be a substitution for personal tax advice as every tax situation is different.  You should obtain personal tax advice from a Certified Public Accountant or other tax professional to address your specific tax needs.

 

The opinions expressed herein are the writer's alone, and do not reflect the opinions of TAPinto.net or anyone who works for TAPinto.net. TAPinto.net is not responsible for the accuracy of any of the information supplied by the writer. Click here to submit a Guest Column.

TAP Into Another Town's News:

You May Also Be Interested In

Sign Up for E-News

Franklin Township

Murphy Administration Takes Action to Help Smokers Quit

July 16, 2018

TRENTON, NJ - The Murphy administration on Monday announced new steps to help New Jersey Medicaid recipients quit using tobacco by making it easier to receive tobacco cessation medications and counseling.

“Tobacco use is the leading preventable cause of death and disease in New Jersey, leading to chronic lung disease, heart disease, stroke and cancer,” said New Jersey Human ...

Upcoming Events

Carousel_image_e733205e1006a416118b_unnamed__1_

Thu, August 2, 5:30 PM

Redstone American Grill, Bridgewater

NAWBO Central & Northern NJ Invites Women ...

Business & Finance Giving Back

Thu, September 6, 6:00 PM

St. Demetrios Greek Orthodox Church, Union

41st Annual Greek Festival

Arts & Entertainment Food & Drink

Viewing Date Set for 1-Year-Old Boy Killed in July 7 Crash in Raritan

July 17, 2018

RARITAN, NJ - A viewing for the 1-year-old Raritan boy killed on Anderson Street July 7 will be held this week at St. Ann Church, in Raritan, according to an obituary released by the Bongiovi Funeral Home.

Matias Ortega-Rosales was killed on the evening of his first birthday when a vehicle hit two cars and then his family as he was being pushed in a stroller by his mother, Domitila Rosales.

South Plainfield Police Investigators Seek Public’s Help in Fatal Crash

SOUTH PLAINFIELD, NJ – The South Plainfield Police Department and Middlesex County Prosecutors Office are looking for the public’s help in the July 4, 2018 fatal motorcycle accident that killed 28 year-old Jessica Montes of Piscataway.

According to police, the accident occurred at approximately 4:50am as the vehicle Montes was a passenger lost control and crashed on New Brunswick ...

Tee times, Pairings Announced for Start of Next Week’s U.S. Junior Amateur Championship at Baltusrol GC in Springfield

SPRINGFIELD, N.J. – The USGA U.S. Junior Amateur Championship starts Monday.  The pairings for the first two rounds of the 71st edition were recently announced.

Monday (July 16) and Tuesday (July 17) tee times will be played on the 7,280-yard, par-71 Upper Course and at the 7,313-yard, par-70 Lower Course at Baltusrol Golf Club.

Monday, Tuesday tee times & pairings

The ...

Newark Lures Amazon With $1 Billion Payroll Tax Incentive

NEWARK, NJ - Amazon will get a payroll tax break at a cost of $1 billion to the city should the company open its second headquarters here.

It’s one of two ordinances that were approved by the Newark City Council council to sweeten the deal for the corporate giant and stand out among other locations vying for Amazon’s so-called HQ2.

“The City Council has brought Newark a ...

New Restaurant Buys ‘Pocketed’ Westfield Liquor License

WESTFIELD, NJ — Westfield’s town council approved the transfer of a liquor license to Westfield Hospitality LLC for its Westfield Fish & Brew Company during the council's meeting Tuesday night. The license had been bought from Jeffrey’s when it closed in 2014 and remained unused, or “pocketed,” by that owner until now.

Though the restaurant does not ...

Piscataway Woman Identified as Victim in Fatal MVA on July 4th

SOUTH PLAINFIELD, NJ – Jessica Montes, 28 of Piscataway, has been identified as the victim in the 4th of July fatal motor vehicle accident on New Brunswick Avenue. Montes, who was a phlebotomist leaves behind her son as well as numerous family and friends.

A small shrine with candles and pictures has been erected at the site of last Wednesday’s tragedy on New Brunswick ...

Viewing Date Set for 1-Year-Old Boy Killed in July 7 Crash in Raritan

July 17, 2018

RARITAN, NJ - A viewing for the 1-year-old Raritan boy killed on Anderson Street July 7 will be held this week at St. Ann Church, in Raritan, according to an obituary released by the Bongiovi Funeral Home.

Matias Ortega-Rosales was killed on the evening of his first birthday when a vehicle hit two cars and then his family as he was being pushed in a stroller by his mother, Domitila Rosales.

South Plainfield Police Investigators Seek Public’s Help in Fatal Crash

SOUTH PLAINFIELD, NJ – The South Plainfield Police Department and Middlesex County Prosecutors Office are looking for the public’s help in the July 4, 2018 fatal motorcycle accident that killed 28 year-old Jessica Montes of Piscataway.

According to police, the accident occurred at approximately 4:50am as the vehicle Montes was a passenger lost control and crashed on New Brunswick ...

Tee times, Pairings Announced for Start of Next Week’s U.S. Junior Amateur Championship at Baltusrol GC in Springfield

SPRINGFIELD, N.J. – The USGA U.S. Junior Amateur Championship starts Monday.  The pairings for the first two rounds of the 71st edition were recently announced.

Monday (July 16) and Tuesday (July 17) tee times will be played on the 7,280-yard, par-71 Upper Course and at the 7,313-yard, par-70 Lower Course at Baltusrol Golf Club.

Monday, Tuesday tee times & pairings

The ...

Somerville: Gallery Hosts Photo Society's 90th Anniversary Exhibit

July 13, 2018

SOMERVILLE, NJ – Arts on Division is presenting “Visions of Raritan Photographic Society – A Celebration of 90 years” from Thursday, July 19 to Sunday, Aug. 19, 2018 at the Gallery on Division, 15B Division Street.

The Raritan Photographic Society, founded in 1929, is the oldest photography club in New Jersey. The exhibit celebrates the organization's 90 years ...

County Kicks Off Summer Concert Series with Bob Miranda and the Happenings

BRIDGEWATER, NJ - The Somerset County Park Commission kicked off its Summer Concert Series at Duke Island Park Sunday with a performance by Bob Miranda and the Happenings.

A very large crowd turned out for the performance by the band made famous in part by the song "See You in September."

The next concert will be held July 15 at 7 p.m. at Duke Island Park, with Billy ...

"Xtreme" Adventures for Teens in Somerset County

BASKING RIDGE, NJ – The Somerset County Park Commission Environmental Education Center  has scheduled a challenging summer program series for teens 13 to 16.

“Xtreme Adventure” is a summer-long series of one-day outdoor programs that will entertain and educate teen girls and boys. All adventures begin at the Environmental Education Center, 190 Lord Stirling ...

Somerville: Gallery Hosts Photo Society's 90th Anniversary Exhibit

July 13, 2018

SOMERVILLE, NJ – Arts on Division is presenting “Visions of Raritan Photographic Society – A Celebration of 90 years” from Thursday, July 19 to Sunday, Aug. 19, 2018 at the Gallery on Division, 15B Division Street.

The Raritan Photographic Society, founded in 1929, is the oldest photography club in New Jersey. The exhibit celebrates the organization's 90 years ...

County Kicks Off Summer Concert Series with Bob Miranda and the Happenings

BRIDGEWATER, NJ - The Somerset County Park Commission kicked off its Summer Concert Series at Duke Island Park Sunday with a performance by Bob Miranda and the Happenings.

A very large crowd turned out for the performance by the band made famous in part by the song "See You in September."

The next concert will be held July 15 at 7 p.m. at Duke Island Park, with Billy ...