The New Year is upon us and many of us are gearing up for tax season, getting organized, preparing necessary documents and getting in touch with accounting professionals. Tax season can seem like a stressful time, but you can limit your stress by staying up-to-date on the latest changes with the tax code and staying organized all throughout the year. It’s important to know where you stand when it comes to your tax burden, especially when it comes to your tax bracket. Tax brackets change and so can your income, which means that what bracket you belonged in last year, may not be the same one as this year. New tax brackets have been revealed for 2019, so what are the new tax brackets and how are you affected? Let’s find out…
Why New Tax Brackets?
You may be asking yourself why the tax brackets are changing, and the reason is to account for inflation. Each year, the tax brackets are adjusted to help adjust for inflation. Since the Tax Cuts and Jobs Act was passed in 2017, many changes have occurred with tax brackets and many individuals were affected by these changes. The tax brackets were lowered significantly, and many filers saw the changes. The 2019 tax bracket changes; however, won’t be seen until you file your 2019 return, which will be in 2020. Read on for what to expect.
New Tax Brackets for 2019
Tax brackets will be changing, and it’s important to find out how these changes will affect you and your tax burden. Tax brackets for 2019 will look like this:
10%: $9,700 or less (individuals) / $19,400 or less (married)
12%: Over $9,700 (individuals) / over $19,400 (married)
22%: Over $39,475 (individuals) / over $78,950 (married)
24%: Over $84,200 (individuals) / over $168,400 (married)
32%: Over $160,725 (individuals) / over $321,450 (married)
35%: Over $204,100 (individuals) / over $408,200 (married)
37%: Over $510,300 (individuals) / over $612,350 (married)
You can also expect the standard deduction to rise to $12,200 for individual filers and $24,400 for married couples.
Other Changes for 2019
Other changes affecting tax payers for 2019 include exemption amounts. For individual filers, it is $71,700 and for married filers, it is $111,700. You’ll also see the earned income credit rising. Joint filers with at least three dependents can expect the earned income credit to rise to $6,557 for 2019. So, not only will the tax brackets be changing, many others aspects of the 2019 tax season will be changing as well. It is imperative that you keep up with these changes, so that you’re prepared when it comes to filing your taxes.
Preparing for Tax Season
It can be a daunting task to get ready for tax season, especially if you’re self-employed or had recent life changes that could affect your tax burden and how you file. Have peace of mind in this situation and be sure to consult the help of a professional, so that you’re not surprised when it’s time to file your taxes. They will help you stay organized and prepared, while helping you limit your tax burden and maximize your refund. Not only can you count on a professional to get the job done correctly, you’ll also know that they have your best interests in mind.
Consult the help of the tax experts at Bodine Perry this tax season! Call (855) 851-8318 or visit www.bodineperry.com to get started today!