
More than 50 tax provisions, including the tax rate schedules and other tax changes are adjusted for inflation in 2017. Let's take a look at the ones most likely to affect taxpayers like you.
The tax rate of 39.6 percent affects singles whose income exceeds $418,400 ($470,700 for married taxpayers filing a joint return), up from $415,050 and $466,950, respectively. The other marginal rates--10, 15, 25, 28, 33 and 35 percent--and related income tax thresholds--are found at IRS.gov.
The standard deduction remains at $6,350 for singles and married persons filing separate returns and $12,700 for married couples filing jointly. The standard deduction for heads of household rises to $9,350, up from $9,300 in 2016.
The limitation for itemized deductions to be claimed on tax year 2017 returns of individuals begins with incomes of $287,650 or more ($313,800 for married couples filing jointly).
The personal exemption for tax year 2017 remains at $4,050. However, the exemption is subject to a phase-out that begins with adjusted gross incomes of $261,500 ($313,800 for married couples filing jointly).
It phases out completely at $384,000 ($436,300 for married couples filing jointly.)
The Alternative Minimum Tax exemption amount for tax year 2017 is $54,300 and begins to phase out at $120,700 ($84,500, for married couples filing jointly for whom the exemption begins to phase out at $160,900).
The 2016 exemption amount was $53,900 ($83,800 for married couples filing jointly). For tax year 2017, the 28 percent tax rate applies to taxpayers with taxable incomes above $187,800 ($93,900 for married individuals filing separately).
For 2017, the maximum Earned Income Credit amount is $6,318 for taxpayers filing jointly who have 3 or more qualifying children, up from a total of $6,269 for tax year 2016. The revenue procedure has a table providing maximum credit amounts for other categories, income thresholds and phase-outs.
Under the small business health care tax credit, the maximum credit is phased out based on the employer's number of full-time equivalent employees in excess of 10 and the employer's average annual wages in excess of $26,200 for tax year 2017, up from $25,900 for 2016.
Need help with tax planning in 2017? Help is just a phone call away! Call us at (405) 759-2796 or schedule a free consultation online.
Tags: Tax Strategies, Deductions, Exemptions