Capital Tax and Financial Services, Inc.


COVID-19 Update 12/1/2020

IMPORTANT NOTICE TO OUR VALUED CLIENTS: Capital Tax continues to monitor the COVID-19 situation closely and we are taking precautionary measures to ensure the safety of all. Any walk in traffic will find the doors locked. Raleigh Office: We will supply envelopes for you to put your information in and ask that you put it in our mail slot.  We are doing some virtual meetings and appointments as needed in office. Littleton/Lake Gaston Office: By appointment only. Please contact us for more information.

We hope you understand the safety and precautionary actions that we are taking, it is best for our staff, their families and for you. We ask that you be patient, your concerns and needs WILL be taken care of. Should you have questions, please email 

We are a full-service Accounting firm located in Raleigh, NC. We offer a broad range of services for businesses and individuals. We are affordable and experienced, and we love what we do, so you are always greeted with a smile.

Our tax professionals are equipped with an education and skill set to tackle any kind of accounting technicality. As the quantity of complex and global transactions increases in modern business, the traditional role of the accountant has adapted to a more dynamic and encompassing field. Whether you have a small business, a startup, or an individual, your accounting needs require a professional touch and services that allow you to focus on your long term goals and strategic targets of your business or your life. Capital Tax and Financial Services, Inc. is one of the best accounting service providers in the Raleigh area.

Intake Forms (please fill out prior to your first visit)

Capital Tax Intake Form

Please view the checklists below to prepare for your visit

Click here for the PDF Version Tax Prep Checklist


Individual Tax Prep Checklist

  • Your Social Security Number or Federal Tax ID number
  • Your Spouse’s Full Name and Social Security Number/ Federal Tax ID number
  • New Clients (Your previous year Tax Return)
  • Current Mailing Address and Occupation Title


  • Children(s) Full Name as shown on Social Security Card
  • Children(s) Social Security numbers and Date(s) of birth
  • Child care records with mailing address and Tax Payers ID
  • Other Applicable adults: Please provide their income

Employee Income Information

  • W-2

Self-Employment Documents

  • 1099-MISC
  • Business Assets
  • Business Miles Driven for work (yearly), Parking, Tolls and applicable vehicle expense
  • Any other expenses associated with Home Office
  • Report of all Expenses (Bank statements, credit card statements, check stubs)
  • We prefer all receipts to be added and categorized. Any expenses not reconciled will incur an additional fee depending on time spent.

Education Information

  • 1098-T from colleges (note: Law changes that only “Amounts Paid” is credited not “Amount Billed”)
  • Any Educational expenses
  • 1098-E for student loan interest paid

Rental Property Information

  • Income
  • Expenses (Maintenance, Repairs, Decors, Utilities, etc.)
  • Property Assets (Hud/ Closing statements)

Retirement, Health Contributions and Contributions to Retirement Plans

  • Retirement Income
  • 5498-SA HSA contributions
  • Pension/ IRA (Form 5498)/ Annuity 1099-R
  • Social Security/ RRB Income 1099-SSA/RRB-1099

Investments and Savings

  • Interest and dividend income (1099-INT, 1099-OID, 1099-DIV)
  • Stock sales and buys(1099-B, 1099-S, 1099-B)

Other Income

  • Unemployment, State Refunds (1099-G)
  • Gambling Income
  • Alimony received
  • HSA and long term care (1099-SA, 1099-LTC)
  • Jury Duty document of pay
  • Other 1099

Affordable Care Act

  • 1095-A ( This form is from the Marketplace Exchange)
  • 1095-B and 1095-C (If you had insurance through any other source)
  • Market Place exemption certificate (ECN)

Other Credits and Deductions

  • Moving expense records (not reimbursed)
  • 1098 Mortgage interest statements
  • If Refinanced, Sold or Purchased a home provided Closing Statement/ HUD1
  • State or Local Taxes Paid (Vehicle Property Taxes, Real estate Property taxes)
  • Cash/ Checks donations to Church, Schools and other credited charitable organizations
  • Documents of non-cash donations and charity
  • Healthcare medical expenses, doctors, co-pays, dentist, prescriptions, miles driven
  • Employment related expenses (dues, uniforms, cleaning, traveling, tools, telephone)
  • Job hunting expenses
  • Energy Saving home improvements
  • Estimated tax payments

Business Tax Checklist

  • Balance Sheets & Profit and Loss Reports


  • Gross Income
  • Business Banking Interest 1099-INT
  • Other Income


  • Cost of Goods Sold (Inventory & Material and Supplies)
  • Advertising, Rent, Phone, travel, Insurance, Office supplies, etc.
  • Pay and commissions to Sub-Contractors 1099-MISC or a 1096
  • Depreciation Assets (Sale or Buy records)
  • Home Office Expenses (square footage of office space and total house square footage, home insurance/rental insurance, utilities, improvements to home office)
  • Salaries and Wages to employees (W-3)
  • Estimated Tax Payments
  • Health Insurance (premiums paid)
  • Health Reimbursement program totals
  • Vehicle Expenses (mileage, maintenance



In 2018, a number of tax provisions are affected by inflation adjustments, including Health Savings Accounts, retirement contribution limits, and the foreign earned income exclusion. Many others have been revised or eliminated due to the TCJA.

While the tax rate structure, which now ranges from 10 to 37 percent, remains similar to 2017 in that there are seven tax brackets, the tax-bracket thresholds increase significantly for each filing status. Standard deductions also rise significantly; however, personal exemptions have been eliminated through tax year 2025.

Alternative Minimum Tax (AMT)

Please see latest update for the EITC HERE

Health Savings Accounts (ASA's)

Contributions to a Health Savings Account (HSA) are used to pay current or future medical expenses of the account owner, his or her spouse, and any qualified dependent. Medical expenses must not be reimbursable by insurance or other sources and do not qualify for the medical expense deduction on a federal income tax return.

A qualified individual must be covered by a High Deductible Health Plan (HDHP) and not be covered by other health insurance with the exception of insurance for accidents, disability, dental care, vision care, or long-term care.

For calendar year 2018, a qualifying HDHP must have a deductible of at least $1,350 for self-only coverage or $2,700 for family coverage and must limit annual out-of-pocket expenses of the beneficiary to $6,650 for self-only coverage and $13,300 for family coverage.

Eligible Long-Term Care Premiums

Premiums for long-term care are treated the same as health care premiums and are deductible on your taxes subject to certain limitations. For individuals age 40 or younger at the end of 2018, the limitation is $420. Persons more than 40 but not more than 50 can deduct $780. Those more than 50 but not more than 60 can deduct $1,530 while individuals more than 60 but not more than 70 can deduct $4,160. The maximum deduction is $5,200 and applies to anyone more than 70 years of age.

Foreign Earned Income Exclusion

For 2018, the foreign earned income exclusion amount is $104,100, up from $102,100 in 2017.

Pease and PEP (Personal Exemption Phaseout)

Both Pease (limitations on itemized deductions) and PEP (personal exemption phase-out) have been eliminated under TCJA.

Penalty for not Maintaining Minimum Essential Health Coverage

Under the TCJA, the penalty for not maintaining minimum essential health coverage has been eliminated but only for months beginning after December 31, 2018.

Standard Deduction

See the latest 2018 Update

"Kiddie Tax"

For taxable years beginning in 2018, the amount that can be used to reduce the net unearned income reported on the child’s return that is subject to the “kiddie tax,” is $1,050 (same as 2017). The same $1,050 amount is used to determine whether a parent may elect to include a child’s gross income in the parent’s gross income and to calculate the “kiddie tax.” For example, one of the requirements for the parental election is that a child’s gross income for 2018 must be more than $1,050 but less than $10,500.

For 2018, the net unearned income for a child under the age of 19 (or a full-time student under the age of 24) that is not subject to “kiddie tax” is $2,100.

Medical Savings Accounts (MSA's)

There are two types of Medical Savings Accounts (MSAs): the Archer MSA created to help self-employed individuals and employees of certain small employers, and the Medicare Advantage MSA, which is also an Archer MSA, and is designated by Medicare to be used solely to pay the qualified medical expenses of the account holder. To be eligible for a Medicare Advantage MSA, you must be enrolled in Medicare. Both MSAs require that you are enrolled in a high-deductible health plan (HDHP).

  • Self only coverage – For taxable years beginning in 2018, the term “high deductible health plan” means, for self-only coverage, a health plan that has an annual deductible that is not less than $2,300 (up $50 from 2017) and not more than $3,450 (up $100 from 2017), and under which the annual out-of-pocket expenses required to be paid (other than for premiums) for covered benefits do not exceed $4,600 (up $100 from 2017).
  • Family coverage – For taxable years beginning in 2018, the term “high deductible health plan” means, for family coverage, a health plan that has an annual deductible that is not less than $4,600 and not more than $6,850 (up $100 from 2017), and under which the annual out-of-pocket expenses required to be paid (other than for premiums) for covered benefits do not exceed $8,400 (up $150 from 2017).
AGI Limit for Deductible Medical Expenses

In 2018, the deduction threshold for deductible medical expenses is temporarily reduced (tax years 2018 through 2025) to 7.5% percent (down from 10% in 2017) of adjusted gross income (AGI).                                                                                                                               

Medicare Taxes

The additional 0.9 percent Medicare tax on wages above $200,000 for individuals ($250,000 married filing jointly), which went into effect in 2013, remains in effect for 2018, as does the Medicare tax of 3.8 percent on investment (unearned) income for single taxpayers with modified adjusted gross income (AGI) more than $200,000 ($250,000 joint filers). Investment income includes dividends, interest, rents, royalties, gains from the disposition of property, and certain passive activity income. Estates, trusts, and self-employed individuals are all liable for the new tax.

Long-Term Capital Gains and Dividends

In 2018 tax rates on capital gains and dividends remain the same as 2017 rates (10%, 15%, and a top rate of 20%); however threshold amounts are different in that they don’t correspond to new tax bracket structure as they did in the past. For taxpayers in the lower tax brackets (10 and 12 percent), the rate remains 0 percent; however, the threshold amounts are $38,600 for individuals and $77,200 for married filing jointly. For taxpayers in the four middle tax brackets, 22, 24, 32, and 35 percent, the rate is 15 percent. For an individual taxpayer in the highest tax bracket, 37 percent, whose income is at or above $425,800 ($479,000 married filing jointly), the rate for both capital gains and dividends is capped at 20 percent.

Estate and Gift Taxes

For an estate of any decedent during calendar year 2018, the basic exclusion amount is $11,200,000, indexed for inflation (up from $5,490,000 in 2017). The maximum tax rate remains at 40 percent. The annual exclusion for gifts increases to $15,000.


Adoption Credit

In 2018, a non-refundable (only those individuals with tax liability will benefit) credit of up to $13,840 is available for qualified adoption expenses for each eligible child.

Child Tax Credits

For tax years 2018 through 2025, the child tax credit increases to $2,000 per child, up from $1,000 in 2017, thanks to the passage of the TCJA.

The enhanced child tax credit, which was made permanent by the Protecting Americans from Tax Hikes Act of 2017 (PATH), remains under TCJA. The refundable portion of the credit increases from $1,000 to $1,400 so that even if taxpayers do not owe any tax, they can still claim the credit. Under TCJA, a $500 nonrefundable credit is also available for dependents who do not qualify for the child tax credit (e.g., dependents age 17 and older).

Earned Income Tax Credit

For tax year 2018, the maximum earned income tax credit (EITC) for low and moderate income workers and working families rises to $6,444, up from $6,318 in 2017. The credit varies by family size, filing status, and other factors, with the maximum credit going to joint filers with three or more qualifying children.

Child and Dependent Care Credit

The Child and Dependent Care Credit also remains under tax reform. If you pay someone to take care of your dependent (defined as being under the age of 13 at the end of the tax year or incapable of self-care) in order to work or look for work, you may qualify for a credit of up to $1,050 or 35 percent of $3,000 of eligible expenses in 2018.For two or more qualifying dependents, you can claim up to 35 percent of $6,000 (or $2,100) of eligible expenses. For higher income earners the credit percentage is reduced, but not below 20 percent, regardless of the amount of adjusted gross income.


American Opportunity Tax Credit & Lifetime Learning Credits

The American Opportunity Tax Credit (formerly Hope Scholarship Credit) was extended to the end of 2018 by ATRA but was made permanent by PATH in 2017. There was no change under TCJA. The maximum credit is $2,500 per student. The Lifetime Learning Credit remains at $2,000 per return; however, the adjusted gross income amount used by joint filers to determine the reduction in the Lifetime Learning Credit is $114,000, up from $112,000 for tax year 2017.

Interest on Educational Loans

In 2018 (as in 2017), the $2,500 maximum deduction for interest paid on student loans is no longer limited to interest paid during the first 60 months of repayment. The deduction is phased out for higher-income taxpayers with modified AGI of more than $65,000 ($135,000 joint filers).

INDIVIDUALS – Retirement

Contribution Limits

The elective deferral (contribution) limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan increases to $18,500. Contribution limits for SIMPLE plans remain at $12,500. The maximum compensation used to determine contributions increases to $275,000 (up from $270,000 in 2018).

Saver's Credit

In 2018, the AGI limit for the saver’s credit (also known as the retirement savings contribution credit) for low and moderate income workers is $63,000 for married couples filing jointly, up from $62,000 in 2017; $47,250 for heads of household, up from $46,500; and $31,500 for married individuals filing separately and for singles, up from $31,000 in 2017.

Income Phase-Out Ranges

The deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are covered by an employer-sponsored retirement plan and have modified AGI between $63,000 and $73,000, up from $62,000 to $72,000.

For married couples filing jointly, in which the spouse who makes the IRA contribution is covered by an employer-sponsored retirement plan, the phase-out range increases to $101,000 to $121,000, up from $99,000 to $119,000. For an IRA contributor who is not covered by an employer-sponsored retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s modified AGI is between $189,000 and $199,000, up from $186,000 and $196,000.

The modified AGI phase-out range for taxpayers making contributions to a Roth IRA is $120,000 to $135,000 for singles and heads of household, up from $118,000 to $133,000. For married couples filing jointly, the income phase-out range is $189,000 to $199,000, up from $186,000 to $196,000. The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.


Standard Mileage Rate

In 2018, the rate for business miles driven is 54.5 cents per mile, up from 53.5 cents per mile in 2017.

Bonus Depreciation

Businesses are allowed to immediately deduct 100% of the cost of eligible property placed in service after September 27, 2017, and before January 1, 2023, after which it will be phased downward over a four-year period: 80% in 2023, 60% in 2024, 40% in 2025, and 20% in 2026.

Work Opportunity Tax Credit (WOTC)

Extended through 2019, the Work Opportunity Tax Credit has been modified and enhanced for employers who hire long-term unemployed individuals (unemployed for 27 weeks or more) and is generally equal to 40 percent of the first $6,000 of wages paid to a new hire. There was no change to this tax credit under TCJA.

Employee Health Insurance Expenses

For taxable years beginning in 2018, the dollar amount of average wages is $26,700 ($26,200 in 2017). This amount is used for limiting the small employer health insurance credit and for determining who is an eligible small employer for purposes of the credit.

Section 179 Expensing

Under the Tax Cuts and Jobs Act of 2017, the Section 179 expense deduction increases to a maximum deduction of $1 million of the first $2,500,000 million of qualifying equipment placed in service during the current tax year. Indexed to inflation after 2018, the deduction was enhanced to include improvements to nonresidential qualified real property such as roofs, fire protection and alarm systems and security systems, and heating, ventilation, and air-conditioning systems.

Section 199 Deduction for Domestic Production Activities

Under the TCJA, the Section 199 deduction was repealed for taxable years beginning after December 31, 2017.

Research & Development Tax Credit

Starting in 2018, businesses with less than $50 million in gross receipts are able to use this credit to offset alternative minimum tax. Certain start-up businesses that might not have any income tax liability will be able to offset payroll taxes with the credit as well. There was no change to this tax credit under TCJA.

Employer-provided Transportation Fringe Benefits

If you provide transportation fringe benefits to your employees, in 2018 the maximum monthly limitation for transportation in a commuter highway vehicle as well as any transit pass is $260, and the monthly limitation for qualified parking is $260. Parity for employer-provided mass transit and parking benefits was made permanent by PATH.

While this checklist outlines important tax changes for 2018, additional changes in tax law are more than likely to arise during the year ahead. Don’t hesitate to call if you want to get an early start on tax planning for 2018!

Capital Tax and Financial Services, Inc.
107 Wind Chime Court (2nd Bldg on Left, our office is around back)

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