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Changes for tax year 2012by roger chartierThe IRS released this information about many tax benefits increasing : Here are some of the changes affecting 2012 returns filed in early 2013: The standard deduction is up $150.00 to $5,950.00 for single people and those married people filing separately. For heads of household it is up by $200.00 to $8,700.00 for heads of household, up $200. Just a bit more than a third of people take itemized deductions like state and local taxes, mortgage interest and charitable contributions, etc. so that leaves the rest of the people taking the standard deductions. The 2012 Tax bracket thresholds will increase for each filing status. For married couples filing a joint return the taxable income threshold separating the 15% bracket from the 25% bracket is up $1,700.00 from 2011 to $70,700. Credits, deductions, and related phase outs.The maximum EITC (Earned income tax credit) for low and moderate income workers and working families goes up by $140.00 to $5,891.00 from $5,751.00 in 2011.The maximum income limit for the EITC is going up by $1,192.00 to $50,270, up from $49,078 in 2011. The maximum credit going to joint filers with three or more qualifying children and the credit is determined by the size of the family, filing status, etc. Their is an increase of $2,200.00 in the foreign earned income deduction. It goes up to $95,100.00. The modified adjusted gross income threshold at which the lifetime learning credit begins to phase out is up by $2,000.00 to $104,000 for joint filers. It's up by $1,000.000 to $52,000 for singles and heads of household. The annual deductible amounts for MSA's (Medical Savings Accounts) is higher as well.
At $125,000 the $2,500 maximum deduction for interest paid on student loans begins to phase out for a married taxpayers filing joint returns and phases out completely at $155,000, which is up by $5,000.00 from the phase out limits for tax year 2011. The additional standard deduction for blind people and senior citizens remains $1,150 for married individuals and $1,450 for singles and heads of household. Estate and Gift Tax ExculsionsConcerning the estate of anyone who dies in the calendar year 2012, the basic exclusion from estate tax amount is up by $ 120.000.00 to $5,120,000, up from 2011. The annual exclusion for gifts stays at $13,000. |
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