Never one to rest on its laurels, the IRS has announced its inflation adjustments for tax preparation in 2015. The data includes tax tables, tax rate schedules, and other adjustments. A quick note, these rates do not apply to your 2014 taxes, or the ones you will be filing for this year. They apply for the taxes you file for next year and give you a sense of what to plan for, and if you’re savvy, what to adjust for.
2015 Tax Preparation – Individual Tax Brackets
This is the data that will affect your individual tax rates and reflects what you tax due amount is. For individuals who earn up to $9,225 per year, the rate will be 10% of taxable income. Those who earn between $9,226 to $37,450 will pay 15%. For most Americans who file individual returns, i.e. those who earn in between $37,451 and $90,750, they will pay a rate of 25% of the amount over $37,450. Those in the highest bracket who earn $413,201 and over will pay 39.6% in federal taxes. A few other quick rates:
- Those who earn $90,751 to $189,300 pay 28%
- Those who earn $189,301 to $411,500 pay 33%
- Those who earn $411,501 to $413,200 pay 35%
The rates are up about 1.6% to 2.1% and are adjusted by the IRS according to things like inflation, cost of living, and other factors.
2015 Tax Preparation – Married Individuals & Surviving Spouses Tax Brackets
If married and filing jointly or recently widowed, these tax rates will apply in 2015.
- From $1 up to $18,450, the tax rate is 10%.
- From $18,451 to $74,900, the tax rate is 15% (Most American married individuals).
- From $74,901 to $151,200, the tax rate is 25%.
- From $151,201 to $230,450, the tax rate is 28%.
- From $230,451 to $411,500, the tax rate is 33%.
- From $411,501 to $464,850, the tax rate is 35%.
- From $464,850 and higher, the tax rate is 39.6%.
2015 Tax Preparation – Married Individuals Filing Separate Returns Tax Brackets
Even if you are married, sometimes it is more advantageous to do tax preparation for both the husband and wife when the tax rates favor it. Below are the rates for 2015.
- From $1 up to $9,225, the tax rate is 10%.
- From $9,226 to $37,450, the tax rate is 15%.
- From $37,451 and $75,600, the tax rate is 25%.
- From $75,601 to $115,225, the tax rate is 28%.
- From $115,226 to $205,750, the tax rate is 33%.
- From $205,751 to $232,425, the tax rate is 35%.
- From $232,426 and higher, the tax rate is 39.6%.
2015 Tax Preparation – Standard Deductions
For those who may not know, the standard deduction is the dollar amount that those who do tax preparation without itemizing may subtract from their income based upon filing status. If your itemized deductions are less than the rate for standard deductions, it makes more sense to file without itemizing. The 2015 tax rates for standard deductions is:
- Those who file as single are allowed $6,300 in standard deductions.
- Those who are married and file jointly are allowed $12,600 in standard deductions.
- Those who are filing as a surviving spouse are allowed $12,600 in standard deductions.
- Those who are married and file separately are allowed $6,300 each in standard deductions.
- Those who are filing as heads of household are allowed $9,250 in standard deductions.
More 2015 Tax Preparation Rates
Although many will fall under the above, there are other new rates and brackets for other taxable items, such as those who file as heads of household will pay less than those who file as individuals. The Pease Limitations are limits as to how much itemized deductions can be filed for those making over a certain rate and are still in effect. For 2015, they apply to individuals earning $258,250 and more or married couples who file jointly that make $309,900 or more.
To read all of the 2015 IRS tax brackets and changes, click the link to be taken to their official release.
Tax Preparation Services in Houston
And if you are in need of expert tax preparation services in Houston or the surrounding area, please contact me.