Current Tax Information...

2012 Mileage Rate Changes

Mileage Type Rate / Mile Effective Date End Date
Business Mileage Rate $0.5550 1/01/2012 12/31/2012
Medical Mileage Rate $0.2300 1/01/2012 12/31/2012
Charitable Mileage Rate $0.1400 1/01/2012 12/31/2012
Moving Mileage Rate $0.2300 1/01/2012 12/31/2012

 

Type of Limitation

2012 

2011

2010

Elective Deferrals (401(k) and 403(b); not including adjustments and catch-ups)
$17,000
$16,500
$16,500
457(b)(2) and 457(c)(1) Limits (not including catch-ups)
$17,000
$16,500
$16,500
Section 414(v) Catch-Up Deferrals to 401(k), 403(b), 457(b), or SARSEP Plans 
$5,500
$5,500
$5,500
Defined Benefit Plans
$200,000
$195,000
$195,000
Defined Contribution Plans
$50,000
$49,000
$49,000
Annual Compensation Limit
$250,000
$245,000
$245,000
Annual Compensation Limit for Grandfathered Participants in Governmental Plans Which Followed 401(a)(17) Limits (With Indexing) on July 1, 1993
$375,000
$360,000
$360,000
Highly Compensated Employee ("HCEs")
$115,000
$110,000
$110,000
Individual Retirement Accounts ("IRAs"), for individuals 49 and below
$5,000
$5,000
$5,000
Individual Retirement Accounts ("IRAs"), for individuals 50 and above
$6,000
$6,000
$6,000
SIMPLE Retirement Accounts
$11,500
$11,500
$11,500
SEP Coverage
$550
$550
$550
SEP Compensation
$250,000
$245,000
$245,000
Tax Credit ESOP Maximum Balance
$1015,000
$985,000
$985,000
Amount for Lengthening of 5-Year ESOP Period
$200,000
$195,000
$195,000
Excess Distribution Threshold
N/A
N/A
N/A
Qualified Police and Firefighters' DB Benefit Limit
N/A
N/A
N/A
Income Subject to Social Security Tax
$110,100
$106,800
$106,800
FICA Tax for employers
7.65%
7.65%
7.65%
FICA Tax for employees
7.65%
5.65%
7.65%
Social Security Tax for employers
6.2%
6.2%
6.2%
Social Security Tax for employees
6.2%
4.2%
6.2%
Medicare Tax for employees and employers
1.45%
1.45%
1.45%
FICA Tax for self-employed workers
15.3%
13.3%
15.3%
Social Security Tax for self-employed workers
12.4%
10.4%
12.4%
Medicare Tax for self-employed workers
2.9%
2.9%
2.9%

 

2011 Standard Deductions & Exemptions*

Taxpayers who do not itemize their deductions are entitled to a standard deduction. The amount of the standard deduction varies according to the taxpayer's filing status.

2011 Standard Deduction

Married, Filing Jointly

$11,600

Single

$5,800

Married, Filing Separately

$5,800

Head of Household

$8,500

Blind or over 65 and married – add:

$1,150

Blind or over 65 and single/head of household – add:

$1,450

Individuals are entitled to a personal exemption amount.

2011 Exemption Amount

2011 Exemption Amount

$3,700

Personal Exemption Phaseout

Married, Filing Jointly

N/A

Single

N/A

Married, Filing Separately

N/A

Head of Household

N/A

 

2011 IRS Tax Brackets

Here are the 2011 tax tables, which make it easy to find which marginal tax bracket you are in:

Single Filers

These tables are for single filers who are not surviving spouses or heads of household:

Taxable Income

Tax

$0 – $8,500

10% of taxable income

$8,500 – $34,500

$850 plus 15% of excess over $8,500

$34,500 – $83,600

$4,750 plus 25% of excess over $34,500

$83,600 – $174,400

$17,025 plus 28% of excess over $83,600

$174,400 – $379,150

$42,449 plus 33% of excess over $174,400

$379,150+

$110,016.50 plus 35% of excess over $379,150

Married & Surviving Spouses

These tables are for married filing jointly or surviving spouses:

Taxable Income

Tax

$0 – $17,000

10% of taxable income

$17,000 – $69,000

$1,700 plus 15% of excess over $17,000

$69,000 – $139,350

$9,500 plus 25% of excess over $69,000

$139,350 – $212,300

$27,087.50 plus 28% of excess over $139,350

$212,300 – $379,150

$47,513.50 plus 33% of excess over $212,300

$379,150+

$102,574 plus 35% of excess over $379,150

Head of Household

These tax tables are for those considered Heads of Household:

Taxable Income

Tax

$0 – $12,150

10% of taxable income

$12,150 – $46,250

$1,215 plus 15% of excess over $12,150

$46,250 – $119,400

$6,330 plus 25% of excess over $46,250

$119,400 – $193,350

$24,617.50 plus 28% of excess over $119,400

$193,350 – $379,150

$45,323.50 plus 33% of excess over $193,350

$379,150+

$106,637.50 plus 35% of excess over $379,150

Married Filing Separately

These are tax tables for those filing as Married Filing Separately:

Taxable Income

Tax

$0 – $8,500

10% of taxable income

$8,500 – $34,500

$850 plus 15% of excess over $8,500

$34,500 – $69,675

$4,750 plus 25% of excess over $34,500

$69,675 – $106,150

$13,543.75 plus 28% of excess over $69,675

$106,150 – $189,575

$23,756.75 plus 33% of excess over $106,150

$189,575+

$51,287 plus 35% of excess over $189,575

2011 Mileage Rate Changes

Purpose

Rates 1/1 through 6/30/11 

  Rates 7/1 through 12/31/11 

Business

51

55.5

  Medical/Moving    

19

23.5

Charitable

14

14

 

2011 FICA Rates:

  • Employee Social Security 2011 FICA Rate: 4.2% (in 2011 the employee rate does not match the employer one)

  • Employer Social Security 2011 FICA Rate: 6.2%

  • Employee Medicare 2011 FICA Rate: 1.45%

  • Employer Medicare 2011 FICA Rate: 1.45%

  • The maximum amount of wages subject to the social security tax for 2011 is $106,800. There is no limit on the amount of wages subject to the Medicare tax.

 

2010 IRS Tax Brackets

The below 2010 tax tables are the projected federal income tax brackets for 2010:

Tax Bracket Single Married Filing Jointly
10% Bracket $0 – $8,375 $0 – $16,750
15% Bracket $8,375 – $34,000 $16,750 – $68,000
25% Bracket $34,000 – $82,400 $68,000 – $137,300
28% Bracket $82,400 – $171,850 $137,300 – $209,250
33% Bracket $171,850 – $373,650 $209,250 – $373,650
35% Bracket $373,650+ $373,650+

Here are some other important non-tax bracket-related updates (until these are made official by the IRS, these are merely predictions by the experts). As expected, no (or very small) changes:

  • Standard deduction remains the same: The standard deduction for singles will remain at $5,700. For married filing jointly, the number will also remain at $11,400. If you are a Head of Household, it’s expected to increase by $50 to $8,400.
  • Personal exemption remains the same: The personal exemption will remain at $3,650.
  • Annual gift tax exclusion unchanged: For 2010, the current 2009 gift tax exclusion of $13,000 is expected to remain the same. The gift tax is how much you can give to someone else without any tax considerations.

 

Tax Year 2010 Personal Exemptions and Deductions

  • Personal Exemption $3,650

  • Deductions Standard Blind/Elderly

  • Single 5,700/1,400

  • Head of Household 8,400/1,400

  • Married 11,400/1,100

  • Standard Deduction for Dependents - $950

 

 

Retirement Plan Limits 2010

Traditional or Roth IRA: $5,000 ($6,000 if age 50 or older)

NO LIMIT on income for ROTH CONVERSION

SEP IRA: $49,000

SIMPLE IRA: $11,500 ($14,000 if age 50 or older)

401(k) plan: $16,500 ($22,000 if age 50 or older)

403(b) plan: $16,500 ($22,000 if age 50 or older)

457 plan: $16,500 ($22,000 if age 50 or older)

Defined Contribution Pension: $49,000

 

2010  Gift and Estate Limits

Annual gift tax exclusion is $13,000

Estate tax exclusion is removed – SUBJECT TO CHANGE

 

2010 optional standard mileage rates

Beginning on Jan. 1, 2010, the standard mileage rates for the use of cars, vans, pickups or panel trucks is:

·  0.50 cents per mile for business miles driven

·  0.165 cents per mile for medical or moving

·  0.14 cents per mile for charitable organizations

 

Changes Starting in 2010

(Subject to Change:  Updated Jan 2010) 

Estate Tax Repealed - The federal estate tax is scheduled to be eliminated for estates of individuals who die in 2010. We expect Congress to act in 2009 to keep the tax alive.

Roth IRA Conversions - Starting in 2010, individuals with more than $100,000 of modified Adjusted Gross Income are free to switch a traditional IRA to a Roth IRA. For conversions in 2010, taxpayers can spread the tax due over two years (or report all of the conversion in 2010).  If elected, half the tax will be due in 2011 and the remaining half will be payable in 2012.

State and Local Sales Tax Deduction - The opportunity for itemizers to choose to deduct their state sales tax payments instead of deducting their state and local income taxes ends after 2009, unless Congress acts to extend it.

Educators' Deduction, Tuition and Fees Deduction, Direct Donations of IRAs to Charity and Additional Standard Deduction for Property Taxes are all set to laps after 2009, unless Congress acts to extend it.

 

2009 Tax Rates

 Single Filing Status

(Tax Rate Schedule X)

10% on income between $0 and $8,350

15% on the income between $8,350 and $33,950; plus $835

25% on the income between $33,950 and $82,250; plus $4,675

28% on the income between $82,250 and $171,550; plus $16,750

33% on the income between $171,550 and $372,950; plus $41,754

35% on the income over $372,950; plus $108,216

 

Married Filing Jointly or Qualifying Widow(er) Filing Status

(Tax Rate Schedule Y-1)

10% on the income between $0 and $16,700

15% on the income between $16,700 and $67,900; plus $1,670

25% on the income between $67,900 and $137,050; plus $9,350

28% on the income between $137,050 and $208,850; plus $26,637.50

33% on the income between $208,850 and $372,950; plus $46,741.50

35% on the income over $372,950; plus $100,894.50

 

Married Filing Separately Filing Status

(Tax Rate Schedule Y-2)

10% on the income between $0 and $8,350

15% on the income between $8,350 and $33,950; plus $835

25% on the income between $33,950 and $68,525; plus $4,675

28% on the income between $68,525 and $104,425; plus $13,318.75

33% on the income between $104,425 and $186,475; plus $23,370.75

35% on the income over $186,475; plus $50,447.25

 

Head of Household Filing Status

(Tax Rate Schedule Z)

10% on the income between $0 and $11,950

15% on the income between $11,950 and $45,500; plus $1,195

25% on the income between $45,500 and $117,450; plus $6,227.50

28% on the income between $117,450 and $190,200; plus $24,215

33% on the income between $190,200 and $372,950; plus $44,585

35% on the income over $372,950; plus $104,892.50

 

Standard Deduction 2009 Returns

Single: $5,700

Head of Household: $8,350

Married Filing Joint: $11,400

Married Filing Separately: $5,700

Qualifying Widow/Widower: $11,400

Dependent: $950-$5,700

Additional Amount if Blind: $1,100

Additional Amount if age 65 or older: $1,100

 

Personal Exemption - Per taxpayer and dependent: $3,650  

 

Important 2009-10 Tax Changes

Tax Credit of Up to $8,000 for First-Time Homebuyers - If you purchased a primary residence in 2009 before December 1, 2009 and are a “first-time” homebuyer, you can qualify for a tax credit equal to 10 percent of up to $80,000 of the purchase price. To be eligible, you must not have owned a residence in the United States in the previous three years.  The new law also provides a “long-time resident” credit of up to $6,500 to others who do not qualify as “first-time homebuyers.” To qualify this way, a buyer must have owned and used the same home as a principal or primary residence for at least five consecutive years of the eight-year period ending on the date of purchase of a new home as a primary residence.

Payroll Tax Credit - For 2009 and 2010, Congress gave workers a credit of 6.2 percent of their earned income, capped at $400 for single filers and $800 for joint filers.

Sales Tax Deduction for New Vehicles- Buyers of new vehicles can deduct the sales tax paid on the purchase, even if they don’t claim sales taxes as itemized deductions.

Indexed Tax Brackets - Thanks to higher inflation in the past year, the 10 percent, 15 percent, 25 percent, 28 percent, 33 percent and 35 percent tax brackets all kick in at approximately 5 percent higher levels of income than in 2008.

Section 179 Expense Deduction - The maximum amount of equipment placed in service in 2009 that businesses can expense stays at $250,000. And the annual investment limit remains $800,000.

Tax Credit for College Tuition - For 2009 and 2010, the Hope credit is replaced by a new credit of up to $2,500 per student a year for four years of college, not just the first two years. It now also covers the cost of books, and begins to phase out at $80,000 of Adjusted Gross Income for single filers and $160,000 for joint filers

Earned Income Tax Credit (EITC) - For families with three or more children, the maximum Earned Income Tax Credit for 2009 and 2010 rises by $628.50. And the phase-out of the credit for joint filers starts at higher income levels in 2009 and 2010, allowing more of them to claim the credit.

Higher Income Limits for Deductible IRAs and for Roth IRAs - If you are covered by a retirement plan at work, you can take a full IRA deduction in 2009 if your modified Adjusted Gross Income is less than $89,000 (married filing jointly) or $55,000 (single or head of household).

State Tax Exemption - In 2009, the federal estate tax exemption rises to $3,500,000 from its 2008 level of $2,000,000.

Credit for Residential Energy-Efficient Property - The credit for 30 percent of the cost of installing solar water heating equipment, solar electric equipment, geothermal heat pumps or small wind turbines in your primary residence or a second home is no longer limited to $2,000 after 2008. But the credit for fuel cell property still cannot exceed $500 per half-kilowatt capacity.

Credit for Energy-Saving Home Improvements - The old 10 percent tax credit of the cost of energy-saving home improvements is increased to 30 percent for 2009 and 2010, up to a maximum of $1,500 in the two-year period. It applies to qualified skylights, windows, outside doors, biomass fuel stoves and high-efficiency furnaces, water heaters and central air conditioners. In addition, the dollar limits on the particular type of improvement, such as a $200 cap on the credit for windows, are repealed.

Converting a Second Home to a Primary Home

If you convert a second home into a principal residence after 2008, you may not be able to exclude all of your gain. A portion of the gain on a subsequent sale of the home will be ineligible for the home-sale exclusion of up to $500,000, even if the seller meets the two-year ownership-and-use tests.

Partial Exclusion for Unemployment Benefits

For 2009, the first $2,400 of unemployment benefits you receive is tax-free.

 

Standard Mileage Rate for 2009

You can deduct the cost of driving a vehicle for business-use, for traveling to a doctor, when relocating for a new job, or when you are engaged in charitable activities. The 2009 standard rates for mileage are:
  • 55 cents per mile for business,
  • 24 cents per mile for medical or moving purposes, and
  • 14 cents per mile for charitable service.

 

Retirement Plan Limits

Maximum contributions vary by the type of retirement plan:

Traditional or Roth IRA: $5,000 ($6,000 if age 50 or older)

SEP IRA: $49,000

SIMPLE IRA: $11,500 ($14,000 if age 50 or older)

401(k) plan: $16,500 ($22,000 if age 50 or older)

403(b) plan: $16,500 ($22,000 if age 50 or older)

457 plan: $16,500 ($22,000 if age 50 or older)

Defined Contribution Pension: $49,000

Defined Benefit Pension: $195,000 

 

Gift and Estate Limits

Annual gift tax exclusion is $13,000

Estate tax exclusion is $2,000,000