2016 Tax Change Information

What you need to know

 

  • Personal Exemption

    • Each person or dependent exemption is worth $4,050

 

  • Standard Deduction:

    • $12,600 for married couples filing a joint return or widows

    • $6,300 for singles and married individuals filing separate returns 

    • $9,300 for heads of household 

    • An additional amount of $1,250 for those who are 65 and older or who may be blind

 

  • Income Tax Brackets:

    • Federal: 10%, 15 %, 25%, 28%, 33%, 35%, 39.6%

    • Colorado: 4.63%

 

  • Maximum credit:

    • $6,143 with three or more qualifying children 

    • $5,460 with two qualifying children 

    • $3,305 with one qualifying child 

    • $496 with no qualifying children

 

**Investment income must be $3,350 or less for the year.**

 

  • Capital Gains:

    • Tax on capital gains for:

    • individuals in a 10% or 15% income tax bracket 0%

    • individuals in a 25%, 28%, 33%, or 35% income tax bracket 15%

    • individuals in a 39.6% income tax bracket 20%

    • Collectibles 28%

    • Estate Tax rises to $5.45 million in value exempted for individual estates and the annual Gift Tax exclusion (Per Doner) is $14,000

 

  • IRA Contributions:

    • Traditional IRA contribution limit cannot be more than $5,500 ($6,500 if you're 65 or older)

 

  • Deferred Retirement Accounts:

    • 401(k), 403(b),: $18,000 

    • Additional contribution if 50 or over: $3,000

 

  • Standard Mileage Rate:

    • Business use: 54 cents per mile

    • Medical reasons or qualified move: 19 cents per mile

    • Charitable purposes: 14 cents per mile