The following 2016 information is an update of the “Preview Of Some Key 2016 Tax Figures” article originally published last October (2015). The October 2015 publication was presented using estimated figures for 2016.
However, the IRS has recently released official 2016 tax figures. This being the case, what better time is there to start thinking about implementing a tax planning initiative focused on tax year 2016 activity? The following up-to-date figures will assist you with that initiative:
Tax Brackets For Taxable Years Beginning in 2016 (Per Rev. Proc. 2015-53):
TABLE 1 - Married Individuals Filing Joint Returns and Surviving Spouses
If Taxable Income Is: The Tax Is:
Not over $18,550 10% of the taxable income
Over $18,550 but $1,855 plus 15% of
not over $75,300 the excess over $18,550
Over $75,300 but $10,367.50 plus 25% of
not over $151,900 the excess over $75,300
Over $151,900 but $29,517.50 plus 28% of
not over $231,450 the excess over $151,900
Over $231,450 but $51,791.50 plus 33% of
not over $413,350 the excess over $231,450
Over $413,350 but $111,818.50 plus 35% of
not over $466,950 the excess over $413,350
Over $466,950 $130,578.50 plus 39.6% of
the excess over $466,950
TABLE 2 – Heads of Households
If Taxable Income Is: The Tax Is:
Not over $13,250 10% of the taxable income
Over $13,250 but $1,325 plus 15% of
not over $50,400 the excess over $13,250
Over $50,400 but $6,897.50 plus 25% of
not over $130,150 the excess over $50,400
Over $130,150 but $26,835 plus 28% of
not over $210,800 the excess over $130,150
Over $210,800 but $49,417 plus 33% of
not over $413,350 the excess over $210,800
Over $413,350 but $116,258.50 plus 35% of
not over $441,000 the excess over $413,350
Over $441,000 $125,936 plus 39.6% of
the excess over $441,000
TABLE 3 – Unmarried Individuals (other than Surviving Spouses and Heads of Households)
If Taxable Income Is: The Tax Is:
Not over $9,275 10% of the taxable income
Over $9,275 but $927.50 plus 15% of
not over $37,650 the excess over $9,275
Over $37,650 but $5,183.75 plus 25% of
not over $91,150 the excess over $37,650
Over $91,150 but $18,558.75 plus 28% of
not over $190,150 the excess over $91,150
Over $190,150 but $46,278.75 plus 33% of
not over $413,350 the excess over $190,150
Over $413,350 but $119,934.75 plus 35% of
not over $415,050 the excess over $413,350
Over $415,050 $120,529.75 plus 39.6% of
the excess over $415,050
TABLE 4 – Married Individuals Filing Separate Returns
If Taxable Income Is: The Tax Is:
Not over $9,275 10% of the taxable income
Over $9,275 but $927.50 plus 15% of
not over $37,650 the excess over $9,275
Over $37,650 but $5,183.75 plus 25% of
not over $75,950 the excess over $37,650
Over $75,950 but $14,758.75 plus 28% of
not over $115,725 the excess over $75,950
Over $115,725 but $25,895.75 plus 33% of
not over $206,675 the excess over $115,725
Over $206,675 but $55,909.25 plus 35% of
not over $233,475 the excess over $206,675
Over $233,475 $65,289.25 plus 39.6% of
the excess over $233,475
TABLE 5 – Estates and Trusts
If Taxable Income Is: The Tax Is:
Not over $2,550 15% of the taxable income
Over $2,550 but $382.50 plus 25% of
not over $5,950 the excess over $2,550
Over $5,950 but $1,232.50 plus 28% of
not over $9,050 the excess over $5,950
Over $9,050 but $2,100.50 plus 33% of
not over $12,400 the excess over $9,050
Over $12,400 $3,206 plus 39.6% of
the excess over $12,400
Personal Exemption: $4,050 in 2016 ($4,000 in 2015)
Standard Deductions:
Deduction Tax Year 2016 Tax Year 2015
Single $6,300 $6,300
Head of Household $9,300 $9,250
Married Filing Joint $12,600 $12,600
Married Filing Separately $6,300 $6,300
Dependents (claimed on $1,050 $1,050
another’s return)
65 or Blind: Married or Single Add $1,250 Add $1,250
Add $1,550 Add $1,550
Other Key figures:
Estate & Gift Tax Exclusion $5.45 Million $5.43 Million
Annual Gift Tax Exclusion $14,000 $14,000
Roth and Traditional IRA Contribution $5,550 $5,500
LIMIT
Exclusion from tax on a gift to a spouse $148,000 $147,000
who is not a U.S. citizen
Foreign earned income exclusion $101,300 $100,800
Phase in limitation for itemized $311,300 $309,900
deductions to be claimed on returns of
individuals - Married
The annual dollar limit on employee $2,550 $2,550
contributions to employer-sponsored
healthcare flexible spending
arrangements (FSA).
Refer to IRC.gov (various) and Rev. Proc. 2015-53 for additional details concerning 2016 rates.
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