As the documents from 2013 start trickling into your mailbox and inbox, now is a great time to get all of your “docs” in a row for 2014, too. Taking the time to understand what’s in store for the year ahead could help you to save some time and possibly money.
It is important that you talk with your tax advisor about how any changes or a donation to Gonzaga may affect your taxes. Here are a few things you’ll need to know as you plan for 2014:
Income Tax Brackets
The rates won’t change, but the IRS did adjust the amount of taxable income for each bracket slightly to account for inflation. You can compare this to where you fit in 2013 to see if your rate is going to change.
| Single filer ordinary income | Married filing jointly ordinary income | 2014 tax rate |
| $0–$9,075 | $0–$18,150 | 10% |
| $9,076–$36,900 | $18,151–$73,800 | 15% |
| $36,901–$89,350 | $73,801–$148,850 | 25% |
| $89,351–$186,350 | $148,851–$226,850 | 28% |
| $186,351–$405,100 | $226,851–$405,100 | 33% |
| $405,101–$406,750 | $405,101–$457,600 | 35% |
| $406,751+ | $457,601+ | 39.6% |
Changes to Exemptions and Deductions
In 2014, you’ll see a few inflation adjustments and increases to the personal exemption and standard deductions.
- Personal exemption will be $3,950*
- Standard deduction for individuals (or married filing separately) will be $6,200
- Standard deduction for married couples filing jointly will be $12,400
- Standard deduction for heads of household will be $9,100
*The amount that can be claimed for personal exemption phases out for adjusted gross incomes of $254,200 and above for single filers and $427,550 for married couples filing jointly.
For itemized deductions, the limitation starts for those with incomes over $254,200 ($305,050 for married couples filing jointly). Deductions for medical expenses can be claimed if your out-of-pocket costs exceeded 10% of your income (7.5% for those ages 65 and over).
What’s New on Your W-2?
The Affordable Care Act requires that, starting in 2014, employers must report on the cost of coverage under employer-sponsored group health plans on an employee’s W-2 form. This number is purely for informational purposes to show employees the value of their health care benefits.
For more details about planning for your 2014 taxes and how a gift to Gonzaga may factor in, call (800)-388-0881, click here or email Judy Rogers in the Office of Planned Giving.
Copyright © The Stelter Company, All rights reserved.
The information on this website is not intended as legal or tax advice. For legal or tax advice, please consult an attorney. Figures cited in examples are for hypothetical purposes only and are subject to change. References to estate and income taxes apply to federal taxes only. State income/estate taxes or state law may impact your results.