Sat. May 8th, 2021

By Delano Sherley

 

  • The standard deduction for married filing jointly will be $25,100; single & married filing separately (MFJ) = $12,550, head of household = $18,800.
  • The lowest rate is 10% for single individuals with income $9,950 or less ($19,900 for MFJ). 12 percent for income over $9,950 ($19,900 for MFJ). 22 percent for income over $40,525 ($81,050 MFJ); 24 percent for income over $86,375 ($172,750 MFJ); 32 percent for income over $164,925 ($329,850 MFJ); 35 percent, for income over $209,425 ($418,850 MFJ); 37 percent for individual single taxpayers with income greater than $523,600 ($628,300 for MFJ).
  • The personal exemption for tax year 2021 remains at 0.
  • There is no limitation on itemized deductions.
  • The max Earned Income Tax Credit is $6,728 for taxpayers with three + qualifying children.
  • The limitation for flexible spending arrangements remains $2,750. For cafeteria plans the maximum carryover is $550.
  • Self-only coverage in a Medical Savings Account: the minimum plan deductible must be no less than $2,400; no more than $3,600. For self-only coverage, the maximum out-of-pocket is $4,800. The family coverage floor for the annual deductible is $4,800, no more than $7,150 and the out-of-pocket expense limit is $8,750.
  • The foreign earned income exclusion is $108,700.
  • The annual exclusion for gifts is unchanged at $15,000
  • The penalty for failure to file a tax return within 60 days of the due date is $435 or 100% of the tax due, whichever is less.