lowered the ammout of federal tax withheld from their workers' paychecks, reflecting lower tax rates for most people and a larger standard deduction
for married couples.
Taxpayers are entitled to a standard deduction
which is based upon their filing status.
The standard deduction
for 1995 is now $6,550 for surviving spouses and married individuals filing joint returns, $5,750 for heads of households, $3,900 for unmarried individuals, and $3,275 for married individuals filing separate returns.
This provision of the Code does not call for indexing based on inflation as do certain other provisions such as the Section 1 tax rate tables, the Section 63 standard deduction
amounts, and the Section 151 personal exemption amount.
If the taxpayer's income from the previous year is unchanged, the compounding effect of indexed tax brackets, standard deductions
and personal exemptions will result in that individual paying less in state taxes for the 2007 tax year.
The new standard deduction
is SI 1,900 for married couples filing a joint return (up $300), $5,950 for singles and married individuals filing separately (up $150) and $8,700 for heads of household (up $200).
frequencies shown for standard deduction
returns were derived by
It phased in (1) an increase to the standard deduction
for married filing jointly (MFJ) to twice that of a single taxpayer by 2009, (2) an increase in the 15% bracket for MFJ to twice that of a single taxpayer by 2008 and (3) changes to the earned income credit.
Because standard deductions
(as well as Social Security wage bases, personal exemptions, tax table rates, etc.
And although the standard deductions
have recently been raised to $4,750 for single taxpayers, $9,550 for married taxpayers filing a joint return and $7,000 for head of household taxpayers, taxpayers who itemize their deductions can drastically reduce their liability to the IRS.
At current tax rates (assuming both Federal and New York State standard deductions
, but no others), her tax in New York City would be $69,603.
Deductions, Exemptions, Estate Tax Standard Deductions
- In 2003, the standard deduction
amounts rise to: $7,950 (filing jointly and surviving spouse), $3,975 (marrieds filing separately) $4,750 (single) and $7,000 (head of household).