Taxes: What you need to know for 2016

February 3, 2016

First up is what's not changing for 2016 are the tax brackets. The top marginal bracket is still 39.6 percent. But the taxable income levels the tax brackets apply to will all increase by about 0.5 percent because the tax law requires these to rise in step with government inflation benchmarks. So, married filers with taxable income in 2016 exceeding $466,951 and single filers with over $415,051 will pay at this top rate.

Also unchanged in 2016 is the maximum amount workers can contribute to their 401(k) or other similar style retirement plans. This remains at $18,000 ($24,000 for workers over age 50 in 2016). Amounts allowed as contributions to IRAs are also the same ($5,500 and $6,500 for those over age 50).

Families that use Health Savings Accounts (HSAs) will be allowed to contribute an additional $100, for a total of $6,750. In 2016, HSA contributions for individuals remain at $3,350.

Continue reading here for tax breaks and by all means, if you have questions or concerns, please contact us.

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