Oklahoma Changes to 2018 Income Tax

Posted September 2018

With all the emphasis on the many Federal tax changes for 2018, we also need to be aware of some changes related to your Oklahoma personal income tax return.

For Federal purposes, personal exemptions were eliminated for 2018. However, Oklahoma will continue to allow personal and dependent exemptions of $1,000 per exemption. An additional exemption of $1,000 may be allowed for taxpayer or spouse who is blind at the close of the tax year.

Oklahoma also allows an additional Oklahoma exemption of $1,000 for each taxpayer or spouse who is sixty-five years of age or older at the close of the tax year IF they meet income qualifications based on their filing status and federal adjusted gross income (Fed AGI) limits. Taxpayers with the following filing status may claim this exemption if the Fed AGI does not exceed: $25,000 for Married Filing Jointly, $12,500 Married and Filing Separately, $15,000 if filing Single, or $19,000 for Qualifying Head of Household.

A new schedule has been added to calculate Oklahoma Itemized Deductions, Schedule 511-D and 511NR-D. Federal itemized deductions must be adjusted by adding back state and local sales or income taxes to arrive at Oklahoma Itemized Deductions. Oklahoma Itemized Deductions are then capped at $17,000, excluding charitable contributions and medical expenses which are not subject to the cap. If you claim itemized deductions on your Federal return, you must claim itemized deductions on your Oklahoma return; this is true even if the Oklahoma itemized deductions are less than the Oklahoma standard deduction.

The Oklahoma standard deduction for tax year 2018, and subsequent years, is equal the 2017 standard deduction. This is set at $6,350 for single or married filing separate, $9,350 for head of household, and $12,700 for married filing joint or qualifying widow(er) with dependent child.