2016 Tax Rates and Other Numbers Are Out

It’s that time of year again. Yes, you better have your turkey and all the other fixings ready for Thanksgiving, but it’s also time to take a look at the latest tax brackets and standard deductions amounts for the upcoming 2016 tax year. To be clear, these apply to the tax return you will file in 2017, not the return you will file in 2016. For those numbers click here. As always, the numbers have changed from this current year, so make sure you make any necessary adjustments if your financial situation has changed significantly, or if you expect it to. Without further adieu, here are the 2016 tax brackets:
2016 Tax Brackets
Individuals:

Over But Not Over Tax Rate
$0 $9,275 10%
$9,276 $37,650 15%
$37,651 $91,150 25%
$91,151 $190,150 28%
$190,151 $413,350 33%
$413,351 $415,050 35%
$415,051 And over 39.6%

Head of Household

Over But Not Over Tax Rate
$0 $13,250 10%
$13,251 $50,400 15%
$50,401 $130,150 25%
$130,151 $210,800 28%
$210,801 $413,350 33%
$413,351 $441,000 35%
$441,001 And over 39.6%

Married Filing Jointly

Over But Not Over Tax Rate
$0 $18,550 10%
$18,551 $75,300 15%
$75,301 $151,900 25%
$151,901 $231,450 28%
$231,451 $413,350 33%
$413,351 $466,950 35%
$466,951 And over 39.6%

Married Filing Separately

Over But Not Over Tax Rate
$0 $9,275 10%
$9,276 $37,650 15%
$37,651 $75,950 25%
$75,951 $115,725 28%
$115,726 $206,675 33%
$206,676 $233,475 35%
$233,476 And over 39.6%

The IRS has also released its standard deductions chart for 2015. Everyone who pays taxes will get a small increase in their standard deduction amount.
Standard Deductions

Filing Status Standard Deduction Amount
Single $6,300
Married Filing Jointly $12,600
Married Filing Separately $6,300
Head of Household $9,300
Surviving Spouse $12,600

Other Changes of Note
There were several other important changes to be aware of for the coming year, which of course you can start preparing for as soon as January arrives. That’s because it’s never too early to start preparing for the next tax season.

The maximum earned income credit amount for taxpayers filing jointly is now $6,269 for those who have 3 or more qualifying children in 2016, which is a slight increase from 2015.
The foreign earned income exclusion has also ticked up slightly from the 2015 mark of $100,800. It will be $101,300 for 2016.
As far as personal exemptions go, the number for 2016 is $4,050 a slight increase from $4000 this year. Also, the Alternative Minimum Tax exemption amount is $83,300 for married couples who file jointly and $53,900 for singles.
Contact GROCO Today
If you want to examine all the latest numbers from the IRS more closely, then visit their website by clicking here. If you want further information about getting ready for your 2015 tax return, or for preparing for your 2015 tax year, then please contact GROCO for assistance. You can reach us by calling 1-877-CPA-2006, or by clicking here.