Some Key Tax Information -- 2003-2011

 

 

Below is from b2 unless OTW stated. p. 6 is Overview thru

 

2003

.2004.

2005

2006

2007

2008

2009

2010

2011

Capital Gains Rates

Tax Brackets Below 15%

Tax Brackets Above 15%

 

5%

15%

 

5%

15%

 

5%

15%

 

5%

15%

 

5%

15%

 

0%

15%

 

10%

20%

 

10%

20%

 

10%

20%

Qualified Dividends Rate

Tax Bracket 15% or below

Tax Bracket Above 15%

 

5%

15%

 

5%

15%

 

5%

15%

 

5%

15%

 

5%

15%

 

0%

15%

 

na

na

 

na

na

 

na

na

Cap Gains and Dividends: A Succinct Rendering of Above (asssuming 2003-2008 is extended forever)

   Ordinary Bracket:  <= 15% Bracket   > 15% Bracket

                      ==============   =============

   Cap Gains:             5%              15%

   5-year Cap Gains:      5%              ???

   Dividends:             5%              15%

   Source: AAII Financial Guide 2003 p. 6, p. 17  Also 2004 Guide

Bob 3/22/04 Session: Long term capital gains: about 5% fed and 5.3% state.

   See TABLE ST;K for another view of this

 

2003

.2004.

2005

2006

2007

2008

2009

2010

2011

Marginal Income Tax Rates

(b2 p. 4  doesn't list the cutoffs though! except for the 10% bkt.)  See below table for 2004.

35% ---------------------------------------------------->

33% ---------------------------------------------------->

28% ---------------------------------------------------->

25% ---------------------------------------------------->

15% ---------------------------------------------------->

10% ---------------------------------------------------->

 

The 10% bracket is $7000 single / $14000 mfj thru 2008. In 2009 and 2010 the 2008 numbers are inflation-adjusted.

In 2011 the 10% bracket disappears.  Source: b2 p. 4

39.6%

36%

31%

28%

15%

na

 

2003

.2004.

2005

2006

2007

2008

2009

2010

2011

Standard Deduction (Under 65)

   Single

   MFJ     

Source: b2 p 19

 

$4,750

$9,500

 

$4,850

$9,700

 

 

 

 

 

 

 

Personal Exemption (b2 p. 19)

$3,050

$3,100

 

 

 

 

 

 

 

Child Credit (b2 p. 4)

$1000

$1000

$1000

$1000

$1000

$1000

$1000

$1000

$500

 

 

 

 

 

 

 

 

 

 

Marriage Penalty Relief

# S.D. (% S.D. for singles)

# 15% Tax Bkt (% of bracket for singles). Source: b2 p. 4

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

200%

 

na

 

na

 

2003

.2004.

2005

2006

2007

2008

2009

2010

2011

Repeal (%) of Personal Exemption PhaseOuts

na

na

na

33.3%

33.3%

66.6%

66.6%

100%

na

Repeal(%) of Limititation on Itemized Deductions.

na

na

na

33.3%

33.3%

66.6%

66.6%

100%

na

 

 

 

 

 

 

 

 

 

 

AMT Exemption

Single

MFJ

 

40250

58000

 

40250

58000

 

33750

45000

 

33750

45000

 

33750

45000

 

33750

45000

 

33750

45000

 

33750

45000

 

33750

45000

Deductible IRA Contribution

   Over age 50

3000

3500

3000

3500

4000

4500

4000

5000

4000

5000

5000

6000

Infla

1K m

Infla

1K m

Infla

1K m

Max 401 K Contribution

   Over age 50

12000

14000

13000

16000

14000

18000

15000

20000

Infla

5K m

Infla

5K m

Infla

5K m

Infla

5K m

Infla

5K m

 

2003

.2004.

2005

2006

2007

2008

2009

2010

2011

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Estate Tax Exemption ($ millions) and top estate tax rate (and GST Tax rate)

1.0

49%

1.5

48%

1.5

47%

2.0

46%

2.0

45%

2.0

45%

3.5

45%

RE-PEALED

1.0

55%

 

Later - I updated above table from the 2004 AAII Guide, b2, so any notes about getting info from 04.JAI is provably obsolete.

 

The Deductible IRA for 2004 and beyond come from Smith Barney newsletter July 2001. and AAII Journal June 2002.  The latter says 2009 and after are the 2008 numbers indexed for inflation in $500 increments.  (The $1,000 catch-up contribution apparently isn't -- the "1K m" means "$1,000 more").

 

The 401K limits comes from a Smith Barney newsletter July 2001 and an AAII Journal August 2001.  The "5K M" means $5000 more, apparently not indexed for inflation.

 

Estate Tax Exemption: From p. 43 of "Ed Slott's Parlay your IRA Into A Family Fortune", 2005 book.  For prior years: 2001 it was $675,000 and 55%, In 2002 It was $1 million and 50%.

 

 

Year

2004

2005

2006

2007

2008

2009

Marginal Income Tax Rates,

 

(taxable income and bracket percent)

SINGLE

$0-7150       10%

7150-29050    15%

29050-70350   25%

70350-146750  28%

146750-319100 33%

> 319100      35%

MFJ

$0-14300      10%

14300-58100   15%

58100-117250  25%

117250-178650 28%

178650-319100 33%

> 319100      35%

 

 

Darn - the 2004 AAII Guide does not have this info anywhere!

 

 

 

 

Above from the below URL gotten 10/9/04.  I had to type it -- View Source and copying is disabled.

http://www.completetax.com/index.asp?page=http://www.completetax.com/taxguide/news/03-108rates.asp

The info is not consistent with the AIII Finance Guide 2003 p. 6 which shows top of 10% bracket a constant $7000 single / 14000 MFJ.  The 2004 AAII Guide shows it a constant $7000 single / $14000 MFJ through 2008.  In 2009 and 2010 they have an inflation adjustment.  In 2011 the 10% bracket disappears.

 

[] Social Security: A single pays 50% taxes on SS benefits if has a "modified" adjusted gross income between 25 K$ and 34 K$, and 85% for amounts above $34,000 .  Modified adjusted gross income is your taxable income PLUS any tax-exempt interest (e.g. municipal bonds) PLUS half of your SS benefits.  Source: b2 (AAII Personal Tax & Financial Planning Guide, 2004), p. 7

   Its not clear if its a STEP jump or like tax brackets where if e.g. has a MAGI of 30 K$, then pays 50% on 5 K$ instead of on 30 K$.  Note that taxable income apparently includes IRA and 401 K distributions -- it doesn't say so explicitly but warnns to delay taking retirement plan distributions as much as are able.  

 

 

Percent of SS Benefits Taxed

Percent of Modified Adjusted Gross Income

 

 

 

  SINGLE AND HEAD OF HOUSEHOLDS

0%

Below $25,000 Single & Head of Household

50%

$25,000 to $34,000 Single & Head of Household

85%

Above $34,000 Single & Head of Household

  MARRIED FILING JOINTLY

0%

Below $32,000 Married Filing Jointly

50%

$32,000 To $44,000 Married Filing Jointly

85%

Above $44,000 Married Filing Jointly

 

 

 

 

 

 

Table STK - Another view of Capital Gains and Dividends - matches 2004 AAII Guide

 

2005-2007 ioep

2008

2009-2010

2011 and beyond

Ordinary Tax Rate

15%

15%

15%

15%

...Cap Gains

5%

0%

10%

10%

...Dividends

5%

0%

15% <.1>

15% <.1>

 

 

 

 

 

Ordinay Tax Rate

25%

25%

25%

28%

...Cap Gains

15%

15%

20%

20%

...Dividends

15%

15%

25% <.1>

28% <.1>

 

 

 

 

 

 

# Above does not include the 5-year capital gain rate, which I don't understand.

<1> Qualified dividends: For 2009 and beyond, the AAII has "na" for the qualified dividends rate.  I assume that means that dividends are taxed at the ordinary tax rate. 

Bob 3/22/04 Session: Long term capital gains: about 5% fed and 5.3% state.

 

 

Minnesota 2005:    FFI: 05.AAL Minnesota Taxes

Ordinary Rates:

  Single: 5.35% up to taxable income of $19,890 and 7.05% up to $65,330, and 7.85% thereafter

  MFJ:    5.35% up to taxable income of $29,070 and 7.05% up to $115,510, and 7.85% thereafter

 

Capital gains: probably same as ordinary rates above based on 3/2004, at least for low income people like me per Bob 3/2004 ( 05.AAN ). I'm wondering though ...

 

Standard Deduction?    Exemptions? 

 

 

Combined

Combined tax rates 1st bracket (low income).  Assuming tax rates add (because am below the standard deduction).  Also, assume Minnesota cap gains are same as ordinary UFN:

 

1st Bracket:

 

Ordinary: 15% + 5.4% = 20.4%

 

CapGain thru end 2007: 5% + 5.4% = 10.4%

     2009 and beyond: 10% + 5.4% = 15.4%

 

 

Dividend thru end 2007: 5% + 5.4% = 10.4%

      2009 and beyond: 15% + 5.4% = 20.4%

 

2nd Bracket:

 

Ordinary: 25 - 28% + 7.0% = 32.0 - 35.0%  (the higher number is 2011 and beyond)

 

CapGain thru end 2007: 15% + 7.0% = 22.0%

      2009 and beyond: 20% + 7.0% = 27.0%

 

Dividend,  thru end 2007:  15% + 7.0% = 22.0%

     2009 and beyond: 25 - 28% + 7.0% = 27.0% - 30.0% (the higher number is 2011 and beyond)