This is the first year of the Tax Cuts and Jobs Act of 2017, and individuals have to now discover what the changes mean for their tax planning and finances this tax season. The new law is laden with little surprises, which will likely add challenges for even the most prepared.

For starters, there are twoquestions everyone needs to ask:

  • What’s my new ordinary income tax rate? The new law cut the top marginal rate from 39.6 percent to 37 percent, and it also altered the income levels at which each rate kicks in. When determining your marginal and effective tax rates, you should also consider the effect of state and local taxes, as the tax act has capped your ability to deduct them.
  • Do I want to take the standard deduction now that it’s $12,000 for a single filer ($24,000 for married couples filing jointly)? The tax act eliminated the personal exemption, but nearly doubled the standard deduction. Still, before assuming the new standard deduction is for you, be sure to tally up any remaining qualifying deductions you may still have this year.

Once you have figured out thebasics, it is time to bring your paperwork in line with the new order. Once youdetermine your 2018 tax liability, you can review your W-4s and, if necessary,make sure to adjust your withholding for 2019.

Despite lowering the tax rate ontop bracket earners, you may find that you need to pay more taxes because ofthe loss of some itemized deductions. There are a few new areas that can bepotential pitfalls; here are some tips to avoid them:

  • The new law offers taxincentives to those who invest in Qualified Opportunity Zones, areas in need ofeconomic revitalization that require capital. If you’ve enjoyed large capitalgains for any of a broad range of reasons, a new provision in the tax lawoffers deferral and possibly forgiveness of capital gain taxes if the gain isinvested in a Qualified Opportunity Fund (generally) within 180 days of thesale of the assets.
  • Taxpayers can take advantageof incentives for investing in certain early-stage private companies bypermitting some or all of the gains from the sale of company shares to berealized tax-free. Non-corporate taxpayers who acquire qualified small businessstock (QSBS) at original issuance and hold it for more than five years may beable to benefit from this incentive. If you and your stock meet certaincriteria, you may be able to reduce or eliminate capital gains tax on its sale.Careful consultation with a tax advisor is necessary to determine whether thesale of certain shares would qualify for the exclusion.
  • Many high-net worth taxpayerspay their taxes with a line of credit. Having access to a line of credit allowsyou to smooth your cash flows and separate your investment decisions from yourliquidity needs. Such a credit line, while used most heavily for springtimetaxes, is useful all year long. Most people think about paying taxes once a year,but high-income earners may pay estimated quarterly taxes.

It is more essential than ever that you speak this year with a tax specialist to ensure that your year-end tax planning supports your short and long-term goals.

Eric Smith and Brian Swenson are Executive Directors at J.P.Morgan Private Bank in Salt Lake City where they co-lead a team of localprofessionals who provide wealth management advice, strategies and services tosuccessful individuals, family offices, foundations and endowments throughoutthe region. This is for information purposes only, JPMorgan Chase & Co.and its subsidiaries do not render tax advice. For tax advice specific toyour situation, please consult your tax advisor.