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Big families fear unintended consequences of new tax law

Posted at 5:49 PM, Dec 19, 2017
and last updated 2017-12-19 19:49:38-05

SALT LAKE CITY - Utah's large families face an uncertain tax picture as new legislation goes into effect.

The lion's share of Utahns will see a tax cut, but the accounting gets tricky as the number of children grows.

The reason? Congress is getting rid of the personal exemption, allowing taxpayers to subtract just over four thousand dollars for every member of the household from the family's gross income. That, and deductions makes the federal adjusted gross income.

Without the personal exemption, large families will have a larger adjusted gross income.

An increased Child Tax Credit will offset much of the loss, and lower rates will make a difference as well.

Another unexpected outcome: Utah charges state income tax as a percentage of a person's federal adjusted gross income, meaning that when the new law takes effect, adjusted gross incomes will increase and state tax bills will grow accordingly.

The state legislative fiscal analyst estimates the state will get an addition $100 to $200 million in revenue because of the change.