Share

Change is in again, at least when it comes to the federal tax code.

Recently, the IRS published the federal tax amounts for the coming calendar year. Unlike last year, many of the inflation-adjusted tax amounts have been adjusted upward.

As taxes impact most of your business and financial decisions ― and many of your personal ones ― planning for them is crucial to your tax and transaction planning for the coming year.

The following guide includes many of the most important tax amounts for 2012 and compares them to the amounts applicable for 2011.

 

Quick Reference Guide for 2012 Federal Income Taxes

 

Social Security 2012 2011
Social Security taxable wage base $110,100 $106,800
Employee portion of Social Security tax 6.2% 4.2%
Self-employed Social Security tax 12.4% 10.4%
Medicare tax 1.45% 1.45%
Medicare taxable wage base No limit No limit
Individual Retirement Accounts 2012 2011
Individual IRA, up to 100% of earned income (combined limit for traditional and/or Roth) $5,000 $5,000
Additional annual catch-up contributions for account owners age 50 and older (Roth and traditional IRA) $1,000 $1,000
Annual Qualified Plan Limits 2012 2011
Maximum compensation used to determine contributions $250,000 $245,000
Deferral limits for plans

     §401(k)

     SIMPLE

     §403(b)

     §457

 

$17,000

$11,500

$17,000

$17,000

 

$16,500

$11,500

$16,500

$16,500

Additional catch-up contributions for employees, age 50 and older

     §401(k)

     SIMPLE

     §403(b)

     §457

 

$5,500

$2,500

$5,500

$5,500

 

$5,500

$2,500

$5,500

$5,500

Highly Compensated Employee threshold $115,000 $110,000
Compensation defining Key Employee in top-heavy plan $165,000 $160,000
Compensation triggering Simplified Employee Pension (SEP) contribution requirement  $550 $550
Maximum annual addition for Defined Contribution Plan $50,000 $49,000
Maximum annual benefit for Defined Benefit Plan $200,000 $195,000
Standard Deduction 2012 2011
Married filing jointly and surviving spouse $11,900 $11,600
Single and married filing separately $5,950 $5,800
Head of household $8,700 $8,500
AMT Exemption Amounts 2012 2011
Married filing jointly and surviving spouse $45,000 $74,450
Single $33,750 $48,450
Married filing separately $22,500 $37,225
AGI for Limit on Certain Itemized Deductions 2012 2011
All filing status categories N/A N/A
Personal Exemption 2012 2011
Amount $3,800 $3,700
Personal Exemption Phase-Out 2012 2011
Phase-Out Begins (adjusted gross income) N/A N/A
Fully Phased Out (adjusted gross income) N/A N/A
Driving Deductions, Per Mile 2012 2011
Business mileage
January 1 – June 30
July 1 – December 31
55.5¢

51.0¢
55.5¢
Charitable mileage 14.0¢ 14.0¢
Medical and moving mileage
January 1 – June 30
July 1 – December 31
23.0¢

19.0¢
23.5¢
Business Equipment 2012 2011
Maximum Section 179 expense deduction $139,000 $500,000
Phase-Out for Section 179, based on asset additions $560,000 $2 million
Qualified Transportation Fringe Benefit Exclusion 2012 2011
Commuter highway vehicle and transit pass, per month $125 $230
Qualified parking, per month $240 $230
Domestic Employees 2012 2011
Annual threshold when a domestic employer is liable to withhold and pay FICA for babysitters, housekeepers, etc. $1,800 $1,700
Kiddie Tax 2012 2011
For an under-age-19 child (or a full-time student under the age of 24), the net unearned income that is not subject to “kiddie tax” $1,900 $1,900
Tax Credits 2012 2011
Maximum American Opportunity Education credit $2,500 $2,500
Federal Estate Tax 2012 2011
Maximum tax rate 35% 35%
Exemption amount, per decedent $5.12 million $5 million
Gift Tax 2012 2011
Annual amount, per recipient (without filing a gift tax return or reducing the lifetime gifting exemption amount) $13,000 $13,000
Lifetime gifting exemption $5.12 million $5 million

 

Bader Martin EmailBader Martin PhoneLinkedInBader Martin Profile