Americans may see smaller tax bills and larger refunds this year thanks to a slate of new deductions and expanded tax breaks included in last year’s tax law, The Wall Street Journal writes.
Key changes include a sharp increase in the state and local tax, or SALT, deduction cap to $40,000, higher standard deductions, and new write-offs for overtime pay, tips income and auto-loan interest on new vehicles assembled in the U.S.
Seniors receive a major boost, with a new $6,000 deduction for taxpayers age 65 and older, in addition to existing age-based benefits. Families also gain from a higher child tax credit and a new government-funded retirement-style account for children born between 2025 and 2028.
The changes could make itemizing more attractive for higher-income households and homeowners in high-tax states, while workers in tipped and overtime-heavy industries may also benefit. Tax experts warn that the new rules are complex, increasing the risk that filers could miss deductions they’re entitled to claim.
