You must file an income tax return for this purpose even if you are otherwise not required to file a return. If you get the benefit of advance credit payments in any amount, or if you plan to claim the premium tax credit, you must file a federal income tax return and use Form 8962.įorm 8962, Premium Tax Credit (PTC), reconciles the amount of advance credit payments made on your behalf with the amount of your actual premium tax credit. 31, 2016, you can choose to have monthly advance credit payments sent directly to your insurer. When you enroll in coverage through the Marketplace during Open Season, which runs through Jan. Need help with tax planning in 2016? Help is just a phone call away! ADVANCE PAYMENTS OF THE PREMIUM TAX CREDIT Under the small business health care tax credit, the maximum credit is phased out based on the employer’s number of full-time equivalent employees in excess of 10 and the employer’s average annual wages in excess of $25,900 for tax year 2016, up from $25,8. The annual dollar limit on employee contributions to employer-sponsored healthcare flexible spending arrangements (FSA) remains at $2,550. The annual exclusion for gifts remains at $14,0. The revenue procedure has a table providing maximum credit amounts for other categories, income thresholds and phase-outs.Įstates of decedents who die during 2016 have a basic exclusion amount of $5,450,000, up from a total of $5,430,000 for estates of decedents who died in 2015.įor 2016, the exclusion from tax on a gift to a spouse who is not a U.S. For tax year 2016, the 28 percent tax rate applies to taxpayers with taxable incomes above $186,300 ($93,150 for married individuals filing separately).įor 2016, the maximum Earned Income Credit amount is $6,269 for taxpayers filing jointly who have 3 or more qualifying children, up from a total of $6,242 for tax year 2015. The 2015 exemption amount was $53,600 ($83,400 for married couples filing jointly). The Alternative Minimum Tax exemption amount for tax year 2016 is $53,900 and begins to phase out at $119,700 ($83,800, for married couples filing jointly for whom the exemption begins to phase out at $159,700). It phases out completely at $381,900 ($433,800 for married couples filing jointly.) However, the exemption is subject to a phase-out that begins with adjusted gross incomes of $259,400 ($311,300 for married couples filing jointly). The personal exemption for tax year 2016 rises to $4,050, up from the 2015 exemption of $4,000. The limitation for itemized deductions to be claimed on tax year 2016 returns of individuals begins with incomes of $259,400 or more ($311,300 for married couples filing jointly). The standard deduction for heads of household rises to $9,300, up from $9,250. The standard deduction remains at $6,300 for singles and married persons filing separate returns and $12,600 for married couples filing jointly. The other marginal rates–10, 15, 25, 28, 33 and 35 percent–and related income tax thresholds–are found at IRS.gov. The tax rate of 39.6 percent affects singles whose income exceeds $415,050 ($466,950 for married taxpayers filing a joint return), up from $413,200 and $464,850, respectively. Let’s take a look at the ones most likely to affect taxpayers like you. More than 50 tax provisions, including the tax rate schedules, and other tax changes are adjusted for inflation in 2016.
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