Dayton 937-898-3167    Sidney 937-492-0386

2018 Client Letter

It is time again to start gathering your tax information for 2017. We would like to send your 2017 tax organizer via email. The tax organizers contain your 2016 tax information and can assist you in compiling your 2017 tax information. We do not require that you use the organizers to compile your 2017 data, but they are available to you if you find them to be of assistance.

For security reasons, no Social Security numbers, birthdates or bank information will be listed within the organizer, and all email attachments will be password protected.

If you wish to receive an organizer, please contact us via email at , or phone call (937-898-3167), and let us know if you would like your organizer emailed, or if you would like a paper copy mailed to you.

In an effort to help eliminate the increasing risk of identity theft, we recommend not mailing your tax returns to you. We recommend that you pick up your completed returns or that we email them to you (password protected). Special mail services will be used for our out-of-state clients.

As tax preparers, it is mandatory that we file federal and state returns electronically. If we have your email address on file, you will receive a confirmation when your tax return has been electronically filed and accepted, along with details of when to expect your refund. Most cities will be required to be mailed with attachments. We will prepare the city returns, however it is your responsibility to sign and mail.


We look forward to seeing you within the next couple of months. Please make every effort to get your information to us as soon as you have it organized to avoid the last minute rush.

If you need an extension for your 2017 tax return, we will do so upon your verbal request.

In closing, after a lengthy career as a CPA with our firm, we would like to congratulate Ken Wiseman on his retirement. Ken’s clients are being serviced by Craig Steinke, CPA, a partner in our firm. Please contact Craig for with any questions you may have regarding this transition.

As always, we appreciate your business.

Very truly yours,

Manning & Associates CPAs, LLC, Partners and Tax Professionals:

John M. Manning CPA
Craig L. Steinke, CPA
Craig Darragh
Shawn LeConey
John C. Bensman, CPA
Sandra L. Comer, CPA
Ellen Pyzoha
Tiffany Taylor
John M. Keller, CPA
Patrick Berbach
Lynne Dunham


1099 Requirement – Applicable if You Own Your Own Business, Farm or Rental Property

If you are a business owner, have a farm, or own a rental property, the Internal Revenue Service requires you to issue Form 1099 to any individual, “unincorporated” business, or any law firm that you paid in excess of $600 per calendar year for services rendered. We are required to indicate on your tax return whether or not payments were made that require filing Form(s) 1099, and if so, whether or not they were filed. Please complete the 1099 Requirement Section on Page 3 of this letter.

If you need assistance or have questions related to the preparation of Form(s) 1099, please contact our office for assistance. You may refer to our website for additional information on this topic. Forms 1099 must be issued to the recipients and to the Internal Revenue Service by January 31, 2018.

Charitable Contributions

We are still required to obtain a client statement with signature for charitable contributions. Please complete and sign the charitable contribution section on the enclosed Signature Page of this letter and submit with your 2017 tax information.

Affordable Care Act in 2010

As a result of the passage of the Affordable Care Act in 2010, we will be asking for information about your medical insurance coverage for 2017. You will need the amount of the premium paid for medical insurance in 2017, either by you, your employer, or the combination of both. If you work for a company that employs over 250 employees, this information should already be on your W-2.

In addition, you will be required to prove that you had adequate medical insurance for all dependents claimed on the tax return for all twelve months of the year. Your medical insurance company may mail to you Form 1095-B –Health Coverage. (If you obtained insurance in the Market Place, you need to download Form 1095-A). Please include this form with your year-end tax information as it will provide the information we need to complete your tax returns.

Minimum Wage Increase

The State minimum wage for 2018 is $8.30 per hour. The Ohio minimum wage for tipped employees is $4.15 per hour (plus tips). The State minimum wage still exceeds the federal minimum wage.


Taxpayers must provide documentation for all dependents claimed on their tax returns. If there is any doubt as to claiming a dependent, we will ask you to complete Form 8867 (Paid Preparer’s Due Diligence Checklist) or, if necessary, Form 8332 (Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent), which must be signed by the custodial parent releasing/revoking the claim to exemption.

Business Expense Documentation

All business expenses claimed as a deduction on your tax returns must have the proper documentation. This includes keeping a mileage log for all business miles.

Highlights of Tax Cuts and Job Act

(this Act will apply to the 2018 returns filed in 2019)

Income Taxes

The Act keeps the seven income tax brackets but lowers tax rates. Employees will see changes reflected in their withholding in February 2018 paychecks. These rates revert to the 2017 rates in 2026.

The Act creates the following chart. The income levels will rise each year with inflation. But they will rise more slowly than in the past because the Act uses the chained consumer price index. Over time, that will move more people into higher tax brackets.

Income Tax Rate

Income Levels for Those Filing As:





10% 10% $0-$9,525 $0-$19,050
15% 12% $9,525-$38,700 $19,050-$77,400
25% 22% $38,700-$82,500 $77,400-$165,000
28% 24% $82,500-$157,500 $165,000-$315,500
33% 32% $157,500-$200,000 $315,500-$400,000
33%-35% 35% $200,000-$500,000 $400,000-$600,000
39.6% 37% $500,000+ $600,000+

Corporate Tax Rate

21 percent, beginning in 2018

Corporate Alternative Minimum Tax


Individual Alternative Minimum Tax

Increase the exemption to $70,300 for singles and $109,400 for joint filers. Increase the phase-out threshold to $500,000 for singles and $1 million for joint filers. The higher limits would expire on Jan. 1, 2026.

Standard Deduction and Personal Exemptions

Current law: $6,350 standard deduction for single taxpayers and $12,700 for married couples, filing jointly. Personal exemptions of $4,050 allowed for each family member.

New law: $12,000 standard deduction for single taxpayer and $24,000 for married couples, filing jointly. Personal exemptions repealed.

Expensing Equipment

Businesses could fully and immediately deduct the cost of certain equipment purchased after Sept. 27, 2017 and before Jan. 1, 2023. After that, the percentage of cost that could be immediately deducted would gradually phase down. Increases the section 179 expensing cap from $500,000 to $1 million.


U.S. companies’ overseas income held as cash would be subject to a 15.5 percent rate, while non-cash holdings would face an 8 percent rate. Companies can make the payments in eight annual installments.

Pass-Through Deduction

Current law: Pass-through businesses, which include partnerships, limited liability companies, S corporations and sole proprietorships, pass their income to their owners, who pay tax at their individual rates.

New law: Owners of Pass-through entities (Non-Service Organizations) may be eligible to deduct 20 percent of their qualified business income. If the owner’s taxable income is below $315,000 for married filing joint or $157,500 for individuals the deduction is 20%. If the owner’s income exceeds the threshold the deduction is the lesser of 20% of its business income or 50% of the total wages paid by the business to its employees.

Owners of Pass-through service organizations are able to deduct 20% of qualified business income if the owner’s taxable income is below $315,000 for married filing joint or $157,000 for single individuals. The 20% deduction is completely phased out over the owners next $100,000 of income over the threshold for married filing joint and $50,000 for single individuals.

Affordable Care Act Individual Mandate

Current law: An individual who fails to buy health insurance must pay penalties of $695 (higher for families) or 2.5 percent of their household income—whichever is higher, but capped at the national average cost of the most basic, low-premium, high-deductible plan.

Repeal of the penalties for 2019.

Individual State and Local Tax Deductions

Current law: Individuals can deduct the state and local taxes they pay, but the value is subject to certain limits for high earners.

New law: Individuals can deduct no more than $10,000 worth of deductions, which could include a combination of property taxes and either sales or income taxes.

Mortgage Interest Deduction

Current law: Deductible mortgage interest is capped at loans of $1 million.

New law: Deductible mortgage interest for new purchases of first or second homes would be capped at loans of $750,000 starting Jan. 1, 2018.

Medical Expense Deduction

Current law: Qualified medical expenses that exceed 10 percent of the taxpayer’s adjusted gross income are deductible.

New law: Reduce the threshold to 7.5 percent of AGI for 2017 and 2018.

Child Tax Credit

Current law: A $1,000 credit for each child under 17. The credit begins phasing out for couples earning more than $110,000. The credit is at least partially refundable to qualified taxpayers who earned more than $3,000.

New law: Doubles the credit to $2,000 and provide it for each child under 17 through year 2025. Raise the phase-out amount to $400,000 married filing joint, and cap the refundable portion at $1,400 per qualified child in 2018.

Estate Tax

Current law: Applies a 40 percent levy on estates worth more than $5.49 million for individuals and $10.98 million for couples.

New law: Double the thresholds so the levy applies to fewer estates. The higher thresholds would sunset in 2026.

Dayton Office
6105 North Dixie Drive
P.O. Box 13449
Dayton, OH 45413
Phone:      (937) 898-3167
Fax:           (937) 898-9202

Sidney Office
500 Folkerth Avenue
Sidney, OH 45365
Phone:        (937) 492-0386
Fax:             (937) 492-3262
Toll Free:   1-888-249-0494

BBBDayton Development CoalitionDayton DefenseNFIBDayton Defense