Southwest Florida sees tax refund boost with new deduction law

FLORIDA, (WINK)—A new law is set to boost tax refunds for many individuals, with the Treasury Department estimating an average increase of $1,000 per household. 

The law raises the standard deduction for individuals by $750 and doubles it for married couples.

For those opting to take the standard deduction, this change could mean a significant increase in their tax returns. However, there is another way to get some extra tax-exempt money.

The new legislation also makes part of overtime and tips tax-exempt. For tips, individuals can deduct up to $25,000, and for overtime, up to $12,500. Specifically, the tax exemption applies to overtime pay.

For instance, if someone earned $6,000 in overtime, they would be tax-exempt on $2,000 of that amount. 

These changes aim to help individuals save more money on their taxes.