What Tax Changes Can You Expect Next Year?
With the New Year almost here that means several new tax changes are on the horizon. These changes are for 2016 and do not apply to the taxes you will be working on in the next few months before April’s deadline. However, it’s a good idea to know what to expect as the new tax year kicks off, because tax-preparation is really a year-round endeavor.
So let’s look at some of the most important tax changes for the coming year. First off, the deadline will be April 18 this year because April 15 falls on a federal holiday, Emancipation Day. So Monday April 18 is the day for most taxpayers, while for people in those states that celebrate Patriot Day the tax deadline will be April 19.
Another change to be aware of is that the tax penalties for not having health insurance, under the Affordable Car Act, will be increasing again. An adult will pay a $695 penalty for not having insurance or 2.5 percent of his or her income. There were will be a maximum amount a family has to pay but that amount will go up from $975 to $2,085 next year.
Tax brackets will be going up slightly in 2016. You can click here to see those brackets. If you file as head of household then your standard deductions are rising by $50. Likewise, personal exemptions are also increasing by $50 in 2016. Other changes include increased limits on health savings accounts, a slight increase in the earned income credit, and a $300 increase in the exemption from the Alternative Minimum Tax. Lastly, the estate tax exemption is also increasing, by $20,000.
As always GROCO will be there to help you make sense of all the tax changes this year and to make sure you understand how they will affect you. Just contact us for assistance at 1-877-CPA-2006 or click here.
70% Qualify for Free 1040 Software
70% Qualify for Free 1040 Software People with an income up to almost $50,000 will get free access to tax return preparation software, the Internal Revenue Service said Tuesday. That means 70 percent of taxpayers can prepare their taxes for free using software available through the IRS Web site — www.irs.gov Still, that is fewer…
Wealthy Should Prepare for Audits by Keeping Organized Records
Wealthy Should Prepare for Audits by Keeping Organized Records Expensive art collections, investment hobbies and offshore bank accounts may raise red flags when it comes to IRS audits. In 2011, the Internal Revenue Service audited 29.93% of taxpayers who reported more than $10 million of annual income [1]. This percentage increased by 18.38% from 2010.…
What Separates Ultra Rich From Everyone Else?
What Separates Ultra Rich From Everyone Else? By Alan Olsen There’s an old cliché in the sporting world that many coaches have used in an effort to help lift their teams when they face what appear to be insurmountable odds. The saying goes: “They put their pants on one leg at time,” or something very…
“Madoff” or “Ponzi-Type” Tax Losses
“Madoff” or “Ponzi-Type” Tax Losses Update: 12/9/09 Wall Street Journal Article: http://online.wsj.com/article/SB124623441944466541.html In addition to other good information about the type and amount of refunds people are obtaining it says in the last paragraph: “On Monday, Sen. Charles Schumer (D., N.Y.) proposed a bill that seeks to further expand the carry-back period up to six…