Tax Tip of the Week | No. 331 | Additional Inflation Adjusted Tax Limits

Tax Tip of the Week | December 2, 2015 | No. 331 | Additional Inflation Adjusted Tax Limits

A couple of months ago (TTW # 322) we took a look at some of the inflation adjusted limits you will see when filing your 2016 taxes.  The IRS recently issued the following announcement:The IRS has announced additional annual inflation adjustments for more than 50 tax provisions for 2016, including the tax rate schedules and other tax changes.Revenue Procedure 2015-53 provides details about these annual adjustments, including:For tax year 2016 participants who have self-only coverage in a Medical Savings Account, the plan must have an annual deductible that is not less than $2,250, up from $2,200 for tax year 2015, but not more than $3,350, up from $3,300 for tax year 2015.For self-only coverage the maximum out-of-pocket expense amount remains at $4,450. For tax year 2016 participants with family coverage, the floor for the annual deductible remains at $4,450; the deductible cannot be more than $6,700, up $50 from the limit for tax year 2015. For family coverage, the out-of-pocket expense limit remains at $8,150.Among other new limits:• The AGI amount used by joint filers to determine the reduction in the Lifetime Learning Credit is $111,000, up from $110,000 for tax year 2015.• The foreign earned income exclusion is $101,300, up from $100,800.• Estates of decedents who die during 2016 have a basic exclusion amount of $5.45 million, up from a total of $5.43 million for estates of decedents who died in 2015.We’ll keep you posted on other changes as they occur.You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.Rick Prewitt – the guy behind TTW...until next week.