IRS to Increase Some Tax Benefits in 2017
The Internal Revenue Service (IRS) announced that the tax year 2017 annual inflation adjustments for more than 50 tax provisions, including tax rate schedules, and other changes. The tax year 2017 adjustments generally are used on tax returns filed in 2018.
The tax items for tax year 2017 of the greatest interest to us include:
- The standard deduction for married filing jointly rises to $12,700 for tax year 2017, up $100 from the prior year. For single taxpayers and married individuals filing separately, the standard deduction rises to $6,350 in 2017, up from $6,300 in 2016, and for heads of households, the standard deduction will be $9,350 for tax year 2017, up from $9,300 for tax year 2016.
- The personal exemption for tax year 2017 remains as it was for 2016: $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.)
- For tax year 2017, the 39.6 percent tax rate affects single taxpayers whose income exceeds $418,400 ($470,700 for married taxpayers filing jointly), up from $415,050 and $466,950, respectively.
Learn more here.