Chapter : Quick Tax Reference 2016 Quick Tax Reference 2016
Quick Tax Reference 2016 The Tax Formula for Individuals
Gross Income
– Deductions for Adjusted Gross Income
= Adjusted Gross Income
– Greater of Itemized Deductions or the Standard Deduction
– Exemptions
= Taxable Income
x Tax Rate (using appropriate tax tables or rate schedules)
= Gross Tax Liability
– Tax Credits and Prepayments
= Tax Due or Refund
Social Security, Medicare & SelfEmployment Taxes
Social Security
Employer
6.20%
Medicare
1.45%
Total
7.65%
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Social Security, Medicare & SelfEmployment Taxes
Employee
SelfEmployed
6.20%
1.45%
7.65%
12.40%
2.90%
15.30%
Wage Base for Social Security and SelfEmployment Tax
Wage Base for Medicare
$118,500
No cap
2016 Federal Tax Rate Schedule
If Taxable Income is
But Not Over:
The Tax is:
Over:
SINGLE INDIVIDUAL
$0
$9,275
$9,275
$37,650
10% of taxable income
15% of taxable income less $463.75
$37,650
$91,150 25% of taxable income less $4,228.75
$91,150
$100,000 28% of taxable income less $6,963.25
$100,000
$190,150 28% of taxable income less $6,963.25
$190,150
$413,350
33% of taxable income less $16,470.75
$413,350
$415,050
35% of taxable income less $24,737.75
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2016 Federal Tax Rate Schedule
If Taxable Income is
But Not Over:
The Tax is:
Over:
$415,050
39.6% of taxable income less $43,830.05
MARRIED FILING J OINTLY OR Q UALIFYING WIDOW(ER)
$0
$18,550
$18,550
$75,300
10% of taxable income
15% of taxable income less $927.50
$75,300
$100,000 25% of taxable income less $8,457.50
$100,000
$151,900 25% of taxable income less $8,457.50
$151,900
$231,450
28% of taxable income less $13,014.50
$231,450
$413,350
33% of taxable income less $24,587.00
$413,350
$466,950
35% of taxable income less $32,854.00
$466,950
39.6% of taxable income less $54,333.70
MARRIED FILING SEPARATELY
$0
$9,275
$9,275
$37,650
10% of taxable income
15% of taxable income less $463.75
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2016 Federal Tax Rate Schedule
If Taxable Income is
But Not Over:
The Tax is:
Over:
$37,650
$75,950 25% of taxable income less $4,228.75
$75,950
$100,000 28% of taxable income less $6,507.25
$100,000
$115,725 28% of taxable income less $6,507.25
$115,725
$206,675
33% of taxable income less $12,293.50
$206,675
$233,475
35% of taxable income less $16,427.00
$233,475
39.6% of taxable income less $27,166.85
HEAD OF HOUSEHOLD
$0
$13,250
$13,250
$50,400
10% of taxable income
15% of taxable income less $662.50
$50,400
$100,000 25% of taxable income less $5,702.50
$100,000
$130,150 25% of taxable income less $5,702.50
$130,150
$210,800 28% of taxable income less $9,607.00
$210,800
$413,350
33% of taxable income less $20,147.00
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2016 Federal Tax Rate Schedule
If Taxable Income is
But Not Over:
The Tax is:
$441,000
35% of taxable income less
Over:
$413,350
$28,414.00
$441,000
39.6% of taxable income less $48,700.00
Child Tax Credit
Amount per child under 17
$1,000
Credit reduction of $50 per $1,000 of modified AGI:
joint filers, in excess of
single or head of household filers, in excess
$110,000
$75,000
of
married filing separately filers, in excess of
$55,000
Standard Deductions
Single
Married Filing Jointly or Surviving Spouse
$6,300
$12,600
Married Filing Separately
$6,300
Head of Household
$9,300
Additional for 65 and Older or Blind—Married
$1,250 5/8
Standard Deductions
Additional for 65 and Older or Blind—Unmarried
$1,550
(per individual and for each situation: age or blind)
The basic standard deduction for employed
$4,050
dependents equals the lesser of: $6,300 or The greater of $1,050 or the individual’s earned income plus $350 Personal/Dependent Exemption
Auto Standard Mileage Allowances
Business: $0.54 Charity Work: $0.14 Medical/Moving: $0.19
Traditional IRA Deduction
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If neither individual nor spouse is a participant in another plan, the maximum deduction is $5,500 if under age 50, or $6,500 if age 50 or over If the individual is an active participant in another plan:
Married/Joint
Max.
AGI
Single AGI
Deduction
Up to $98,000
Up to $61,000
$5,500 (under 50) $6,500 (50 or over)
$98,001–
$61,001–
$117,999
$70,999
$118,000 and
$71,000 and
Over
Over
Phasedout
No deduction
If the individual is not an active participant in a qualified retirement plan (but spouse is), allowable contributions are fully deductible up to $184,000 and phasedout at $194,000 of joint income
Roth IRA Requirements
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Individuals and spouses can contribute a maximum $5,500 plus $1,000 for taxpayers age 50 or over Contribution amount is phasedout when AGI is between: $117,000 and $132,000 for single filers $184,000 and $194,000 for joint filers Contributions are not taxdeductible Like traditional IRAs, contributions are limited to amount of earned income
Chapter : Quick Tax Reference 2016 Quick Tax Reference 2016
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