Tax Question – Personal Exemption

Q: What happens to the $4050 personal exemption in the new tax law? I just read on one site that it goes away. If so, then the benefit from the increase in the standard deduction is partially muted, isn’t it?

A: Thanks for reaching out to us. Starting in 2018, the personal exemption will go away and will be replaced by a larger standard deduction. While this amount will still be larger than the old Standard Deduction + Personal Exemption, you are correct that it will be somewhat muted if you are comparing the old vs. new standard deduction.