2017 tax rates: It always pays to plan ahead — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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2017 tax rates: It always pays to plan ahead

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in Office Management,Payroll Management

Employees can take a lot of the guesswork out of their 2017 income tax liability by ensuring that their W-4s are accurate. Those who need to file new forms due to changes in their personal financial situation have information on which to base their decisions. Low-income employees may qualify for the earned income tax credit. (Rev. Proc. 2016-55, IRB 2016-45)

Standard deductions and phase-out amounts. The 2017 standard deduction amounts are:

  • Singles and marrieds filing separately: $6,350
  • Marrieds filing jointly: $12,700
  • Heads of households: $9,350
  • Dependents: the greater of $1,050 or the sum of $350 and their earned income, up to the standard deduction amount
  • Extra standard deduction for aged or blind: $1,550 (singles) or $1,250 per eligible spouse (marrieds filing jointly).

For 2017, the income limits at which personal exemptions and itemized deductions are phased start at $313,800 for joint filers; for single taxpayers, both limits start at $261,500.

Earned income credit. Depending on family size and wages, low-income employees may qualify for the earned income tax credit. The credit is phased out at certain income levels.

  • One child: The maximum credit is $3,400. The credit begins to be phased out for income exceeding $18,340 (singles/heads of households) or $23,930 (joint filers), and is completely phased out when wages exceed $39,617 (singles) or $45,207 (joint filers).
  • Two children: The maximum credit is $5,616. The credit begins to be phased out for income exceeding $18,340 (singles/heads of households) or $23,930 (joint filers), and is completely phased out when wages exceed $45,007 (singles) or $50,597 (joint filers).
  • Three or more children: The maximum credit is $6,318. The credit begins to be phased out for income exceeding $18,340 (singles/heads of households) or $23,930 (joint filers), and is completely phased out when wages exceed $48,340 (singles) or $53,930 (joint filers).
  • No children: The maximum credit is $510. The credit begins to be phased out for income exceeding $8,340 (singles/heads of households) or $13,930 (marrieds filing jointly), and is completely phased out when wages exceed $15,010 (singles) or $20,600 (joint filers).

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