2020 FEDERAL TAX BRACKETS CODE

However, one of the tax changes for 2020 came thanks to the Tax Cuts and Jobs Act, which zeroed out that individual mandate penalty. This was known as the individual mandate penalty. If you are one of those people and you weren’t covered, you were subject to a penalty - due when you paid your taxes. Under the Affordable Care Act, there are people who are required to have health insurance. Tax Changes for 2020: Health Insurance Penalty IRA catch-up contribution (taxpayers over 50) - $7,000 (unchanged from last year)ĥ.IRA base contribution - $6,000 (up $500 from tax year 2018).401(k) catch-up contribution (taxpayers over 50) - $25,000 (unchanged from last year).You can also deduct contributions from your tax return.Īnother of the tax changes for 2020 includes a raise in contribution limits to 401(k) plans and individual retirement accounts: Also, if you are fortunate enough, your employer may also match your contribution up to a certain percentage. In addition to saving for retirement, a benefit of a 401(k) is the ability to save money out of your paycheck automatically. Tax Changes for 2020: Retirement Account ContributionsĪccording to a Stanford Center On Longevity study, around 90% of Americans who have access to a 401(k) retirement savings plan use it. Family coverage - Not less than $4,650 and not more than $7,000 (up $150 from tax year 2018).Self-only coverage - Not less than $2,350 and not more than $3,500 (up $50 from tax year 2018).One of the tax changes for 2020 is a raise in the contribution limits and out-of-pocket expenses for people who are eligible for an HSA. Because the money is pretax, there is the possibility you can lower your overall health care expenses by using one, according to. Tax Changes for 2020: Health Savings AccountsĪ lot of companies today offer employees the option of a health savings account or HSA.Īn HSA is basically a savings account that allows you to save pretax money to use for medical expenses. Here are the brackets for those married individuals filing joint returns: 12% - Income more than $9,700 but not more than $39,475.Here are those tax brackets for people who are filing as single, according to IRS Rev. However, one of the five tax changes for 2020 is a slight rise in the income amounts due to inflation. The 2020 tax brackets are the same as last year. Since 2018, there have been seven different tax rates for individual tax filers. For example, a married couple filing joint tax returns would not have to pay taxes on the first $24,400 of their taxable income. Heads of households - $18,350 (up $350 from tax year 2018)Īs a refresher, the standard deduction is the amount of income subject to federal taxes.Single or married filing separately - $12,200 (up $200 from tax year 2018).Married, filing jointly - $24,400 (up $400 from tax year 2018).Here are the changes, according to the IRS: Just about everyone wins here because the standard deduction for tax year 2019 went up in every applicable category. Perhaps the biggest of the five tax changes for 2020 is the standard deduction you can take when filing. Tax Changes for 2020: Standard Deductions Here’s a look at five tax changes for 2020 (tax year 2019) that impact you: 1.

Sometimes those changes are big and sometimes they are minute.įor the 2019 tax year - your return is due in April 2020 - there are tax changes ranging from bracket amounts to standard deductions to health savings account contributions.Īnd it’s important to know what the changes are and how they may impact you and your family.

2020 FEDERAL TAX BRACKETS CODE

tax code sees some kind of change that impacts all taxpayers. It’s hard to believe the time to start thinking about filing taxes is already almost upon us.Įvery year the U.S. There are some tax changes for 2020 that all tax filers should be interested in.

2020 federal tax brackets