The 2016 tax rates have just been announced by my friends at the IRS. My friends? Well, to be sure, they are not the enemy. The IRS enforces the tax code. You know who writes it? Congress. So whenever there’s a change in the code or something you don’t like, don’t look at the IRS, look toward Capitol Hill.
The tables aren’t the actual tax you pay on gross income, but on taxable income which is gross less a number of items, including the personal exemption which rises to $4,050 in ’16 and the standard deduction is unchanged at single $6,300 or joint $12,600.
I’ll be referring back to this article over the next year whenever the tax table is part of the conversation. Check out the new rate table and start planning for 2016.