Personal Exemptions

Personal exemptions were tax deductions that allowed individuals to reduce their taxable income based on the number of people in their household, including themselves and dependents. This means for each person claimed, a set amount was deducted from total income, lowering the overall tax bill. However, personal exemptions were eliminated by the Tax Cuts and Jobs Act of 2017, shifting the focus to increased standard deductions. While personal exemptions helped reduce taxable income, current tax benefits now primarily come through standard deductions and child tax credits.