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What’s New for 2015 TAX FILING 2015


Standard Deductions 2015

The Basic standard deduction for 2015 is $12,600 for married persons filing jointly and qualifying widows/widowers, $9,250 for heads of households, or $6,300 for single taxpayers or married persons filing separately. The additional standard deduction for being 65 or older or blind is $1,550 if single or head of household ($3,100if 65 and blind). If married filing jointly, the additional standard deduction is $1,250 if one spouse is 65 or older or blind, $2,500 if both spouses are at least 65 (or one is 65 and blind, or both are blind and under age 65).

Tax Rate Brackets 2015

The 10%, 15%, %25%, 28%, 33%, 35% and 39.6% brackets for 2015 ordinary income reflect an inflation adjustment. The top bracket of 39.6% applies if taxable income exceeds $413,200 for single taxpayers, $439,000 for head of households, $464,850 for married persons filing jointly and qualifying widows/widowers, and $232,425 for married taxpayers filing separate returns.

Individual Health Care Mandate 2015

You are required to have minimum essential health coverage through an employer plan, a government program, or other plan, or pay a penalty, unless you are exempt from this requirement. The penalty amount for 2015 is the higher of 2% of household income above your filing threshold, or $325 per person in your household ($162.50 per dependent child under age 18), up to a maximum of $975.

Phaseout Of Personal Exemptions 2015

Personal exemptions and itemized deductions are subject to a phaseout. Each $4,000 personal exemption for 2015 is subject to a phaseout  if adjusted gross income (AGI) exceeds $309,900 if married filing jointly or qualifying widow/widower, $284,050 if head of household, $258,250 if single, and $154,950 if married filing separately.

Mortgage Interest Limit For Unmarried Co-Owners 2015

An appeals court held that if unmarried individuals co-own a residence, each co-owner can deduct interest on acquisition debt of up to $1 million and home equity debt up to $100,000. This decision disagreed with the Tax Court and IRS view that the $1.1 million debt limit must be divided among the co-owners.

Basis Of Property Reported On Estate Tax Return 2015

Executors filing estate tax returns after July 31, 2015 must report the date-of-date value of property included in the gross estate to the IRS and to the heirs. The heirs will be subject to a penalty if on a later sale of the property, they claim a basis for the property that exceeds the amount that had been reported to the IRS by the executor.

Self-Employment Tax 2015

For 2015, the tax rate on the employee portion of Social Security is 6.2% on wages up to $118,500, so Social Security tax withholdings should not exceed $7,347. Medicare tax of 1.45% is withheld from all wages regardless of amount.

IRA and Roth IRA Contribution 2015

For 2015, the contribution limit for traditional IRAs and Roth IRAs is unchanged at $5,500, or $6,500 for those age 50 or older.

IRS Mileage Allowance 2015

The IRS standard business mileage rate for 2015is 57.5 cents a mile. The rate for medical expenses and moving expenses deductions is 23 cents a mile. For charitable volunteers, the mileage rate is unchanged at 14 cents a mile.

Earned Income Tax Credit 2015

For 2015, the maximum credit amount is $3,359 for one qualifying child, $5,548 for two qualifying children, $6,242 for three or more qualifying children, and $503 for taxpayers who have no qualifying child. The phaseout ranges for the credit have been adjusted for inflation.


What’s New for 2016 TAX FILING 2016



​IRS Identity Fraud 2016


Identity theft, fraud and scams are high according to the Internal Revenue Service. Should you receive notice from IRS or from someone representing they are from the IRS please DO NOT provide any information to them until you have confirmed they are legitimate. Remember the IRS does not initiate contact via email or telephone. Their initial contact is usually a written notice. When in doubt, ask for assistance.

Refund Delays 2016

If your 2016 tax return claims an Earned Income Tax Credit or the Additional Child Tax Credit your refund will be held by IRS until February 15th. This delay is being mandated by recent tax law changes because of the proliferation of identity theft and fraudulent tax returns using taxpayer information. This extra time will be used by the IRS to help prevent revenue loss due to theft.

Those most impacted by this change are early tax return filers. If you typically file early, do not delay filing your tax return because of this rule change. Tax returns can still be processed. Only the refund is being delayed. Filing early can help you avoid the bottleneck of tax refund processing. On February 15th you will want to be at the front of the line to receive your money. If you historically plan on receiving an early refund, you will now need to plan for this delay.


Tax Filing Date Changes 2016

There are new tax filing deadlines effective for 2016 tax returns. Small businesses that are organized as a partnership or limited liability companies filing Form 1065 must file their tax return on or before March 15, 2017. This moves the required filing date up one month versus last year. Year-end C Corporations filing is a month later. The old filing date of March 15th is now moved to April 15th. Annual reporting of foreign bank accounts moves from June 30th to April 15th. This is FBAR Form 114.
 
Standard Deductions 2016

The Basic standard deduction for 2016 is $12,600 for married persons filing jointly and qualifying widows/widowers, $9,300 for heads of households, or $6,300 for single taxpayers or married persons filing separately. The additional standard deduction for being 65 or older or blind is $1,550 if single or head of household ($3,100 if 65 and blind). If married filing jointly, the additional standard deduction is $1,250 if one spouse is 65 or older or blind, $2,500 if both spouses are at least 65 (or one is 65 and blind, or both are blind and under age 65).

Income Brackets For 2016 Tax Rates

The 10%, 15%, %25%, 28%, 33%, 35% and 39.6% brackets for 2016 ordinary income reflect an inflation adjustment. The top bracket of 39.6% applies if taxable income exceeds $415,050 for single taxpayers, $441,000 for head of households, $466,950 for married persons filing jointly and qualifying widows/widowers, and $233,475 for married taxpayers filing separate returns.

Personal Exemptions Phase-out 2016

Personal exemptions and itemized deductions are subject to a phase-out. Each $4,050 personal exemption for 2016 is subject to a phase-out if adjusted gross income (AGI) exceeds $311,300 if married filing jointly or qualifying widow/widower, $285,350 if head of household, $259,400 if single, and $155,650 if married filing separately.

Mortgage Insurance Premium Deduction 2016

If your are required to pay Mortgage Insurance Premiums you may deduct them on your 2016 tax return , but not in future years.

Tuition and Fees Deduction 2016

This popular deduction for up to $4,000 of qualified tuition and fees expires in 2016.

No Taxable Income On Cancellation Of Debt 2016

For years there was an extended tax break for debt forgiveness related to home mortgages. This program comes to an end in 2016.

IRS Mileage Allowance 2016

The IRS standard business mileage rate for 2016 is 54 cents a mile. The rate for medical expenses and moving expenses deductions is 19 cents a mile. For charitable volunteers, the mileage rate is unchanged at 14 cents a mile.

Earned Income Tax Credit 2016

For 2016, the maximum credit amount is $3,373 for one qualifying child, $5,572 for two qualifying children, $6,269 for three or more qualifying children, and $506 for taxpayers who have no qualifying child. The phase-out ranges for the credit have been adjusted for inflation.

Identity PIN 2016

Look for your Identity PIN. If you are among the millions who have been impacted by IRS Identity theft you will receive a PIN from the IRS. This PIN is your added security to ensure that would be thieves can not successfully process a tax return using your private information. If you receive this IRS notice do not throw it out. Last year the IRS mislabeled the form with the wrong year. Those who accidentally threw it out then faced the hassle of getting it replaced.