March 18, 2013
There are several tax changes every year affecting the tax returns. Tax changes for the year 2013 are as follows:
- In year 2013, Standard deductions are increased to $12,200 for those married filing jointly, $8,950 for those filing as head of household, and $6,100 for those filing as single.
- The top estate tax rate is 40% and the estate tax exemption is $5.25 million.
- For capital assets acquired in 2013, Section 179 deduction is up to $500,000
- Also 50% bonus depreciation is allowed for the assets that are qualified assets which are placed in service by the end of year 2013.
- In year 2013, the personal exemption amount is $3,900 which was a raise as compared to last year.
- For people who want to contribute to their 401(k) plan for 2013, they can contribute up to $17,500
- There are following income brackets; 10%, 15%, 25%, 28%, 33%, 35% and 39.6% individual tax rates for 2013.
- Mileage rates for business are increased to $0.565 and medical are increased to $0.24 respectively.
- For people 50 or older, the IRA contribution limit is increased to $5,500 or $6,500.
- The taxable wage limit for social security was increased to $113,700.
- The employee Social Security tax rate is put back to 6.2%. Also, the Social security tax rate under SECA (self-employment tax)is put back at 12.4%