Things to be Aware of for the Upcoming 2018 Filing Season

Here are some things to be aware of as we approach the 2018 filing season:

Tax Cuts and Jobs Act Has Only Minimal Effect on 2017 Federal Returns
Except for the three provisions listed below all of the new tax changes that were included in the recently passed Tax Cuts and Jobs Act go into effect beginning in 2018 or beyond.

The following do go into effect at some point in 2017 and thus will be applicable for 2017 federal returns:

• Medical Expense Deduction Threshold
  The AGI threshold for medical expenses on Schedule A will be 7.5% for all taxpayers for 2017 and 2018.
• 100% Bonus Depreciation
  Qualifying assets purchased after September 27, 2017 will be eligible for 100% bonus depreciation.
• Home Mortgage Interest Limitation
  The taxpayer may deduct the interest on no more than $750,000 of principal residence acquisition indebtedness for loans incurred beginning on or after December 15, 2017. The limit is $1,000,000 for loans incurred before December 15, 2017.

Expiration of ITINs
At the end of 2017 the following ITINs expired and must be renewed if an individual wants to use it on a 2017 federal return:

• ITINs with middle digits of 70, 71, 72 or 80.
• ITINs that have not been used at least once in the last three consecutive years

See the IRS Individual Taxpayer Identification Number page for more information on expiring ITINs and how to renew an ITIN.

Be Aware of Phishing Emails
Preparers need to be on the lookout for spear phishing emails that are targeting tax preparers. The goal of these phishing emails is to take over a preparer’s computer (or computer system) in order to obtain the tax and personal information of their clients.

Spear phishing emails pose as familiar entities and are tailored to the individual preparer. These emails disguised as being from a trusted source seek to have the preparer voluntarily disclose sensitive information such as passwords. They may also encourage the preparer to open a link or attachment that actually downloads malware onto their computer. Once the malware is downloaded the cybercriminal now has access to the preparer’s computer and (all information contained on it) without them even knowing about it.

See the following on the IRS website for more information on what to look out for and examples of phishing emails:

• Avoid Spear Phishing Emails
• Don’t Take the Bait
• Recognizing Phishing Email Scams