How did the 2018 Tax Reform Cuts affect your personal tax situation?

I'm NOT trying to start a political debate here! Just curious about everyone's real experience with the major tax reform that kicked in for 2018. They made some big changes - lowered tax rates, almost doubled the standard deduction, increased Child Tax Credit, eliminated Personal exemptions, and put a cap on SALT deductions. In my case, it worked out pretty well from 2018-2023. I'm in Wisconsin and was renting until August 2023, so I always took the Standard Deduction. When my husband and I bought our house last summer, we qualified for homeowner exemptions, but since we only owned it for part of the year, our mortgage interest and property taxes were pretty minimal. So for 2023 taxes, we still took the standard deduction. The lower rates and higher standard deduction definitely lowered my tax bill from 2018-2023. For 2024, I'm not so sure... My husband and I both got raises, which means more State tax withheld. Plus, we'll have a full year of mortgage interest and property taxes (Wisconsin has pretty high property taxes - not as bad as Illinois, but up there). I think we'll probably exceed the standard deduction this year. But with the loss of 2 Personal exemptions, I'm wondering if we might end up paying more than we would have under the old tax law. What about your situation? Did the tax changes help or hurt your bottom line?

0 coins

18 comments

Mei Zhang

•8M

Having prepared taxes professionally since 2005, I can tell you the impact varied widely depending on family size, income level, and where you live. For most middle-income folks taking the standard deduction, the changes were generally positive due to the nearly doubled standard deduction and expanded Child Tax Credit. A family with 2 kids making $75k-100k typically saw savings between $1,200-2,500 annually. However, families with 3+ children sometimes saw smaller benefits or even paid more because the elimination of personal exemptions ($4,050 per person) offset some gains. People in high-tax states who itemized and had significant SALT deductions (over the new $10k cap) often paid more, especially upper-middle-income homeowners. The simplest way to compare is to look at your effective tax rate (total tax divided by total income) before and after the changes. Most people saw this percentage decrease slightly, but it wasn't universal.

0 coins

Mei Zhang

•8M

The Child Tax Credit doubled from $1,000 to $2,000 per child, which is an extra $1,000 per child in credits. This is generally more valuable than the exemption for many families, but not everyone. When you have 4 kids, you lost 6 personal exemptions total (you, your wife, and 4 kids), which at $4,050 each would have been $24,300 in deductions. At a 22% tax bracket, those exemptions would have saved you about $5,346. The additional $4,000 in Child Tax Credits might not have fully compensated for this, especially if your income was high enough that you weren't eligible for the full credit amount under the old law but were under the new higher income thresholds.

0 coins

Amara Oluwaseyi

•8M

I tried using an online calculator to figure this out for my situation but kept getting confused. Then I found https://taxr.ai which helped me run both scenarios for my specific situation. It analyzed my returns under both sets of tax rules to show the actual difference. For me (single, homeowner in Pennsylvania), I saved about $1,750 each year from 2018-2023. The calculator showed that while I lost my personal exemption, the increased standard deduction and lower rates more than made up for it. Seeing the side-by-side comparison really cleared things up for me.

0 coins

Amara Oluwaseyi

•8M

It absolutely helped with the itemize vs. standard deduction question. It runs both scenarios and shows which one saves you more money, plus explains the threshold you'd need to hit for itemizing to make sense. As for being sketchy, I was skeptical too, but it breaks down each calculation line by line and explains which tax provisions are affecting your situation. It's actually educational - I learned my mortgage interest alone wasn't enough to justify itemizing, but combined with my charitable donations, it just crossed the threshold.

0 coins

Giovanni Rossi

•8M

Just wanted to update that I gave taxr.ai a try after my skeptical comment. Actually impressive. I've been married filing jointly with 2 kids and a house in Virginia since 2016, so I could see exactly how the reform affected us. Turns out we saved about $3,200 per year under the new rules! The doubled Child Tax Credit was huge for us ($4,000 instead of $2,000), and even though we lost $16,200 in personal exemptions, the increased standard deduction and lower tax rates more than made up for it. The analysis explained that our effective tax rate dropped from 13.8% to 11.2%. The tool also predicted that we'll pay more in 2026 if the provisions expire as scheduled, which I hadn't even considered. Definitely worth checking out if you want to understand your specific situation.

0 coins

Fatima Al-Maktoum

•8M

The tax changes were a disaster for me! I live in New Jersey with high property taxes ($15k) and state income tax (about $12k). Before 2018, I could deduct all of that. After the $10k SALT cap, I lost $17k in deductions! I spent three weeks trying to get someone at the IRS to explain if there were any workarounds. Endless busy signals and disconnections. Finally used https://claimyr.com and their video tutorial at https://youtu.be/_kiP6q8DX5c to actually get through to an IRS agent. They connected me in about 20 minutes when I'd been trying for weeks. The IRS person confirmed what I feared - no workarounds for the SALT cap for individuals. But they did help me identify some business deductions I was missing that partially offset the loss.

0 coins

Fatima Al-Maktoum

•8M

It uses some kind of call technology to navigate the IRS phone system and hold your place in line. When they're about to connect to an agent, you get a call back and they connect you directly. It's definitely the real IRS. The agent pulled up my actual tax records and went through my previous returns. They even sent me follow-up documentation through my IRS online account portal. No way a scammer could do that. I was just as skeptical as you are before trying it - I thought it was going to be a waste of money, but after weeks of frustration, it was worth every penny to finally get answers.

0 coins

Sofia Gutierrez

•8M

Ok I have to admit I was completely wrong about Claimyr. After my skeptical comment, I decided to try it myself since I've been trying to resolve an issue with a missing stimulus payment for months. Got connected to an actual IRS agent in about 30 minutes. She confirmed my identity with my previous tax info and addressed my missing payment issue - turns out it was applied to a past tax debt I didn't realize I still had. She walked me through the whole situation and even sent me documentation showing where the money went. For my original tax reform question - as a homeowner in California, I definitely paid more after 2018. My state and local taxes were about $18k, so losing $8k of those deductions hurt. The agent explained some strategies for tax year 2024 that might help. Definitely worth the call.

0 coins

Dmitry Petrov

•8M

Remember the tax cuts expire after 2025! So even if you benefited, your taxes will likely go up in 2026 unless Congress acts to extend them. I'm already planning ahead by increasing my 401k contributions to offset the expected increase. My situation: family of 4 in Texas (no state income tax). We saved about $3,200/year with the changes - mostly from the expanded Child Tax Credit and lower rates. But I calculated that when things revert in 2026, we'll pay about $2,800 more than we do now.

0 coins

Dmitry Petrov

•8M

As the law currently stands, most of the individual tax provisions will expire after 2025. Congress would need to pass new legislation to extend them. Some of the business provisions were made permanent, but the personal income tax changes were temporary. There's always talk about extending popular tax cuts, but that requires congressional action. Given how difficult it is to get anything passed these days, I'm planning for the expiration while hoping for an extension. Best to be prepared either way.

0 coins