income tax rates

•Personal Exemptions Eliminated•

 

Personal and dependent exemptions are eliminated under the new TCJA from 2018 to 2025. You are not able to reduce the income that subjects to tax by the exemptions amount for each person included on your tax return as you have in previous years such as yourself, your spouse, or your dependents.

•2020 Individual Income Tax Brackets•

 

The Federal income tax has 7 rates: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. The amount of tax you owe depends on your income level and filing status. The top marginal income tax rate of 37 percent will hit taxpayers with a taxable income of $518,400 and higher for single filers and $622,050 and higher for married couples filing jointly.

Here are the 2020 tax rates and brackets organized by filing
status:

single

•2020 Standard Deduction Amounts•

 

There are 2 main types of tax deductions: the standard deduction and itemized deductions. You are allowed to claim one type of deduction on your tax return, but not both. For instance, if you claim the standard deduction, you cannot claim itemized deductions – and vice versa (if you itemized deductions, you cannot claim the standard deduction). You can use whichever type of deduction results in the lowest tax. Here are the standard deduction amounts by filing status:

The standard deduction is $1,300 higher for those who are over
65 or blind. It is $1,650 higher if they're also unmarried and not a surviving spouse. If someone can claim you as a dependent, you get a smaller standard deduction.

•2020 Long-term Capital Gains Tax Brackets•

 

Long-term capital gains re-taxed using different brackets and
rates than ordinary income.

•2019 Individual Income Tax Brackets•

 

The Federal income tax has 7 rates: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. The amount of tax you owe depends on your income level and filing status. The top marginal income tax rate of 37 percent will hit taxpayers with a taxable income of $510,300 and higher for single filers and $612,350 and higher for married couples filing jointly.

Here are the 2019 tax rates and brackets organized by filing
status:

single

Married Filing Jointly or Qualifying Widow(er)

Married Filing Separately

Head of Household

•2019 Standard Deduction Amounts•

 

There are 2 main types of tax deductions: the standard deduction and itemized deductions. You are allowed to claim one type of deduction on your tax return, but not both. For instance, if you claim the standard deduction, you cannot claim itemized deductions – and vice versa (if you itemized deductions, you cannot claim the standard deduction). You can use whichever type of deduction results in the lowest tax. Here are the standard deduction amounts by filing status:

The standard deduction is $1,300 higher for those who are over
65 or blind. It is $1,650 higher if they're also unmarried and not a surviving spouse. If someone can claim you as a dependent, you get a smaller standard deduction.

•2019 CA individual income tax rates & corresponding brackets•

 

Here are California's individual income tax rates and corresponding brackets for 2019:

In addition to those income tax brackets, there is a 1% tax on personal income over $1 million. As part of the Mental Health Services Act, this tax provides funding for mental health programs in the state. It functions like a normal income tax and means that the top marginal rate in California is, effectively, 13.3%. That’s the highest rate in the U.S., but it only applies to income earners with over $1 million in taxable income.

Christine Lo

Accounting and Tax Services

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