Another tax year’s filing deadline has come and gone, and for many, that means a whole year without a second thought given to taxes. However, now is the perfect time to make decisions about the 2011 tax year!
Following are some key tax provisions to consider for 2011 individual tax return planning:
Income tax rates for 2011 will remain the same as in 2010 with 35% being the highest tax bracket. Be aware however that the tax brackets have been adjusted for inflation.
Long-Term Capital Gains will continue to be taxed at 0% for those individuals in the 10-15% tax bracket and will be taxed at no more than 15% for all other tax payers.
The AMT exemption amounts for 2011 will be $48,450 for individuals filing a single return, $74,450 for those filing a joint return, and $37,225 for those filing a married filing separate return.
The standard deduction for a married filing joint couple will remain at double the standard deduction of an individual filing a single return.
The Child Tax Credit of $1,000 has been extended, however, be aware that it phases out for taxpayers with adjusted gross income of $110,000 for joint filers and $75,000 for other filers.
Jordan Nellé, CPA
Davis & Hodgdon Associates CPAs