2015 Predicted Inflation Adjusted Tax Items

The following are some of the more salient tax items adjusted unofficially for inflation by Research Institute of America.  While unofficial they represent a very good estimate of predicted adjusted items for 2015.  This list is not all inclusive. IRS is required to release the “official” adjustments by December 15, 2014.

Estate and Gift and Long Term Care:

  • Unified estate and gift tax exclusion amount for estates of decedents dying in 2015 should rise to $5,430,000.
  • The exemption from Generation Skipping Transfer Tax should be $5,430,000 for transfers in 2015.
  • The gift tax annual exclusion should be $14,000, unchanged from 2014.
  • The limit on the decrease in value that can result from the use of special use valuation for estates of those dying in 2015 will be $1,100,000.
  • The annual exclusion for gifts in 2015 to noncitizen spouses will be $147,000.
  • Amounts paid for insurance that covers qualified long-term care services are treated as medical expenses up to dollar limits that vary with the age of the taxpayer as of the close of the tax year.
    • For a taxpayer age 40 or younger, the limit will be $380;
    • more than 40 but not more than 50, $710;
    • more than 50 but not more than 60, $1,430;
    • more than 60 but not more than 70, $3,800; and
    • more than 70, $4,750.
  • Amounts received under a qualified long-term care insurance contract are generally excludable as amounts received for personal injuries and sickness, subject to a per day limitation, which will remain the same as in 2014 at $330.

Income Tax Items:

The basic standard deduction for 2015 ought to be:

  • Joint return or surviving spouse: $12,600
  • Single (other than head of household or surviving spouse) $6,300
  • Head of household                     $9,250
  • Married filing separately           $6,300
  • For an individual who can be claimed as a dependent on another’s return, the basic standard deduction should be $1,050.
  • The additional standard deduction for married taxpayers 65 or over or blind should be $1,250 and for a single taxpayer or head of household who is 65 or over or blind, the additional standard deduction should be $1,550.
  • The exemption from the kiddie tax should be $2,100.
  • The personal exemption amount should be $4,000, subject to “phase out” rules.

The tax rate schedule for married, joint filers ought to be as follows:

If taxable income is:                                        The tax is:

Not over $18,450                                            10% of taxable income

Over $18,450 but not over $74,900                $1,845.00 plus 15% of the excess over $18,450

Over $74,900 but not over $151,200              $10,312.50 plus 25% of the excess over $74,900

Over $151,200 but not over $230,450            $29,387.50 plus 28% of the excess over $151,200

Over $230,450 but not over $411,500            $51,577.50 plus 33% of the excess over $230,450

Over $411,500 but not over $464,850            $111,324.00 plus 35% of the excess over $411,500

Over $464,850                                                            $129,996.50 plus 39.6% of the excess over 464,850

For Estates and Trusts, the tax rates ought to be:

If taxable income is:                                        The tax is:

Not over $2,500                                              15% of taxable income

Over $2,500 but not over $5,900                    $375.00 plus 25% of the excess over $2,500

Over $5,900 but not over $9,050                    $1,225.00 plus 28% of the excess over $5,900

Over $9,050 but not over $12,300                  $2,107.00 plus 33% of the excess over $9,050

Over $12,300                                                  $3,179.50 plus 39.6% of the excess over $12,300

The allowable amount of itemized deductions should be reduced if adjusted gross income is more than $309,000 for married filing jointly and surviving spouses.

An employee should be able to exclude up to $250 a month for qualified parking expenses, and up to $130 a month of the combined value of transit passes and transportation in a commuter highway vehicle.

Business:

The amount that may be expensed under Code Sec. 179 should be unchanged for 2015 at $25,000 and, unchanged from 2014, the expensing limit should be reduced when more than $200,000 of expensing-eligible property is placed in service.

PK Law attorneys can help with your estate planning, elder care and tax planning for the rest of this year and beyond.  Please contact one of them to obtain answers to specific tax questions and request an appointment.  Contact information@pklaw.com for additional information. 

This information is provided for general information only.  None of the information provided herein should be construed as providing legal advice or a separate attorney client relationship. Applicability of the legal principles discussed may differ substantially in individual situations. You should not act upon the information presented herein without consulting an attorney of your choice about your particular situation. While PK Law has taken reasonable efforts to insure the accuracy of this material, the accuracy cannot be guaranteed and PK Law makes no warranties or representations as to its accuracy.