 |
McCusker
& Associates - December 2011 Tax Update
 Happy
Holidays!
Offering
up new tax plans is all the rage on the political circuit
these days. Among the schemes being offered up are consumption
taxes, value added taxes, flat taxes and my favorite, Herman
Cain’s 9-9-9 plan, which I think has a provision for
taking your refunds in pizza coupons.
The
purported aim of all these plans is to improve the way in
which the government picks our pockets (did I say that out
loud?), I mean collects revenues. We’re told the extension
of that efficiency is that this will improve the economy,
reduce the deficit, make your kids smarter and ultimately
deliver us out of the mess we now find ourselves in. Why am
I skeptical when the government/IRS says they are going to
make my life better and easier?
Tax
simplification is a noble pursuit and I do hope we see it
in our lifetimes, but I give it about the same odds as science
discovering a cure for male pattern baldness - of course I’d
be happy with either of these outcomes. So while we wait for
tax fairness (or hair regeneration) below you will find the
not so simplified rates and deductions for the 2011 and 2012
tax years:
|
Tax
Facts |
| Standard Deductions: |
2011 |
|
Married
Joint |
$11,600 |
|
Married Separate |
5,800 |
|
Single |
5,800 |
|
Head of Household |
8,500 |
|
| |
|
|
| Personal Exemption Amounts: |
$3,700 |
|
| |
|
|
| 2011 Tax Brackets: |
|
|
Married Joint |
Taxable Income |
Rate |
| |
$0 - $17,000 |
10% |
| |
17,001– 69,000 |
15% |
| |
69,001 – 139,350 |
25% |
| |
139,351 – 212,300 |
28% |
| |
212,301 – 379,150 |
33% |
| |
over $379,150 |
35% |
Single |
Taxable Income |
Rate |
| |
$0 - $ 8,500 |
10% |
| |
8,501– 34,500 |
15% |
| |
34,501– 83,600 |
25% |
| |
83,601– 174,400 |
28% |
| |
174,401 – 379,150 |
33% |
| |
over $379,150 |
35% |
Head of Household |
Taxable Income |
Rate |
| |
$0 - $12,150 |
10% |
| |
12,151 – 46,250 |
15% |
| |
46,251 – 119,400 |
25% |
| |
119,401 – 193,350 |
28% |
| |
193,351– 379,150 |
33% |
| |
over $379,150 |
35% |
| |
|
|
| 2011/2012 Capital Gains Tax Rate:
Federal 15%, Mass 5.3% (In 2011/2012 taxpayers with a
marginal tax bracket of 15% or below will pay 0% federal
capital gains tax - below $69,000 of taxable income for
married couples) |
| |
|
|
| Traditional & Roth IRA Contribution Limit |
2011 |
2012 |
| |
$5,000 |
$5,000 |
| Additional Allowable Contribution if > 50 yrs old |
1,000 |
1,000 |
| |
|
|
| 401(k) and 403(b) Employee Contribution Limits
|
16,500 |
17,000 |
| Additional Allowable Contribution if > 50 yrs old
|
5,500 |
5,500 |
| |
|
|
| SEP/IRA Contribution Limits (Self-Employed) |
49,000 |
50,000 |
| |
|
|
| SIMPLE IRA Employee Contribution Limits |
11,500 |
11,500 |
| Additional Allowable Contribution if > 50 yrs old |
2,500 |
2,500 |
| |
|
|
| Standard 2011 Mileage Rates for Auto Use: |
Jan
- Jun |
Jul
- Dec |
Business |
51.0 cents/mi |
55.5 cents/mi |
Charitable |
14.0 |
14.0 |
Medical |
19.0 |
23.5 |
Moving |
19.0 |
23.5 |
| |
|
|
2011 Child Tax Credit (for children
under 17 at Dec 31): $1,000
2011 Charitable contributions –
cash contributions of any amount need to be evidenced
by proof of payment, either a cancelled check or receipt.
Contributions over $250 need a written acknowledgement
from the charity indicating date and amount. |
| |
|
|
| Annual Gift Tax Exclusion |
2011 |
2012 |
| |
$13,000 |
$13,000 |
| |
|
|
| 2012 Estate Tax - $5 million
individual exclusion with a 35% top tax rate
|
I
hope this was of value and as always I welcome your questions
and feedback.
Jim |
|
