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Quick Reference Guide for 2016 and 2015 Federal Taxes

Updated to include the impact of tax extenders in the PATH Act of 2015.

The following guide includes many of the most important federal tax amounts for 2016, and compares them to the amounts currently applicable for 2015 tax returns.

Social Security and Medicare  2016 2015
Social Security taxable wage base $118,500 $118,500
Social Security tax

Employee

Self-employed

6.2%

12.4%

6.2%

12.4%

Medicare taxable wage base No limit No limit
Medicare tax

Employee

Self-employed

1.45%

2.9%

1.45%

2.9%

Medicare surtax (generally on net investment income of married couples with modified AGI > $250,000; $200,000 for single persons) 3.8% 3.8%
Individual Retirement Accounts 2016 2015
Individual IRA, up to 100% of earned income (combined limit for traditional and/or Roth) $5,500 $5,500
Additional annual catch-up contributions for account owners age 50 and older (Roth and traditional IRA) $1,000 $1,000
Annual Qualified Plan Limits 2016 2015
Maximum compensation used to determine contributions $265,000 $265,000
Deferral limits for plans

§401(k) and §403(b)

SIMPLE

§457

 

$18,000

$12,500

$18,000

 

$18,000

$12,500

$18,000

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

§401(k) and §403(b)

SIMPLE

§457



$6,000

$3,000

$6,000



$6,000

$3,000

$6,000

Highly Compensated Employee threshold $120,000 $120,000
Compensation defining Key Employee in top-heavy plan $170,000 $170,000
Compensation triggering Simplified Employee Pension (SEP) contribution requirement $600 $600
Maximum annual addition for Defined Contribution Plan $53,000 $53,000
Maximum annual benefit for Defined Benefit Plan $210,000 $210,000
Federal Tax Rates 2016 2015
Maximum individual income tax rate 39.6% 39.6%
Taxable income beyond which top rate begins:

Married filing jointly and
surviving spouse

Single

Head of household

Married filing separately



$466,950


$415,050

$441,000

$233,475



$464,850


$413,200

$439,000

$232,425

Maximum rate for qualified capital gains and dividends 20% 20%
Hospital insurance tax (on income > $250,000 for married couples and $200,000 for single persons) 0.9% 0.9%
Standard Deduction 2016 2015
Married filing jointly and surviving spouse $12,600 $12,600
Single and married filing separately $6,300 $6,300
Head of household $9,300 $9,250
AMT Exemption Amounts 2016 2015
Married filing jointly and surviving spouse $83,800 less
25% of AMT income
> $159,700
$83,400 less
25% of AMT income
> $158,900
Single $53,900 less
25% of AMT income
> $119,700
$53,600 less
25% of AMT income
> $119,200
Married filing separately $41,900 less
25% of AMT income
> $79,850
$41,700 less
25% of AMT income
> $79,450
Personal Exemption 2016 2015
Amount $4,050 $4,000
Personal Exemption + Itemized Deduction Phase-Out 2016 2015
Phase-out begins (adjusted gross income)

Married filing jointly and
surviving spouse

Single

Head of household

Married filing separately




$311,300


$259,400

$285,350

$155,650




$309,900


$258,250

$284,050

$154,950

Driving Deductions, Per Mile 2016 2015
Business mileage 54.0¢ 57.5¢
Charitable mileage 14.0¢ 14.0¢
Medical and moving mileage 19.0¢ 23.0¢
Business Equipment 2016 2015
Maximum Section 179 expense deduction $500,000 $500,000
Phase-Out for Section 179, based on all eligible asset additions $2,000,000 $2,000,000
Qualified Transportation Fringe Benefit Exclusion 2016 2015
Commuter highway vehicle and transit pass, per month $255 $250
Qualified parking, per month $255 $250
Domestic Employees 2016 2015
Annual threshold when a domestic employer is liable to withhold and pay FICA for babysitters, housekeepers, etc. $2,000 $1,900
Kiddie Tax 2016 2015
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” $2,100 $2,100
Federal Estate Tax 2016 2015
Maximum tax rate 40% 40%
Exemption amount, per decedent $5.45 million $5.43 million
Gift Tax 2016 2015
Annual amount, per recipient (without filing a gift tax return or reducing the lifetime gifting exemption amount) $14,000 $14,000
Lifetime gifting exemption $5.45 million $5.43 million
Exclusions, Deductions and Credits 2016 2015
Exclusion of gain on qualified small business stock (QSBS) 100% 100%
Foreign income exclusion $101,300 $100,800
Bonus first-year depreciation 50% 50%
Maximum nontaxable IRA distributions to certain charities, if at least age 70½ $100,000 $100,000
Maximum deduction for teacher classroom expenses $250 $250
Maximum deduction for higher education expenses $4,000 $4,000
Maximum American opportunity education credit (formerly the Hope credit) $2,500 $2,500

 

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