Key Changes to the Tax Rate:
- Standard Deduction – Increased by $50 for a head of household, but stayed the same for single filers and married people filing separate returns, as for married couples filing jointly stayed the same in 2016.
- Gift Tax – Remains the same at $14,000
- Alternative Minimum Tax – increased marginally to keep up with inflation.
- Single Filers – Exemption $53,900 and starts to phase out at $119,700
- Married Jointly – Exemption $83,800 and starts to phase out at $159,700
For the tax year 2016, the 28 percent AMT tax rate applies to taxpayers with taxable incomes above $186,300 ($93,150 for married individuals filing separately).
- Personal Exemptions – Increased by $50, however, the exemption is subject to a phase-out that begins with adjusted gross income of $259,400
- Married Jointly – starts to phase out $311,300 and completely phases out at $381,900
- Foreign Earned Income Exclusion – Increased by $500 to $101,300
- Earned Income Credit – The EIC for taxpayers filing Jointly who have 3 or more qualifying children is $6,269
- Flexible Spending Arrangement – Contribution limits will increase by $50 to $2,550