IRS ANNOUNCEMENT: Estates of decedents who die during 2020 have a basic exclusion amount of $11.58 million, up from a total of $11.4 million for estates of decedents who died in 2019. An individual taxpayer may leave $11.58 million to heirs with no federal or gift taxes due. A married couple will be able to leave $23.16 million.
The gift tax exclusion remains at $15,000, the same as it was for 2019.
The standard deduction for married filing jointly rises to $24,800 for tax year 2020, up $400 from the prior year.
For single taxpayers and married individuals filing separately, the standard deduction rises to $12,400 in for 2020, up $200, and for heads of households, the standard deduction will be $18,650 for tax year 2020, up $300.
The Alternative Minimum Tax exemption amount for tax year 2020 is $72,900 and begins to phase out at $518,400 ($113,400 for married couples filing jointly for whom the exemption begins to phase out at $1,036,800).The 2019 exemption amount was $71,700 and began to phase out at $510,300 ($111,700, for married couples filing jointly for whom the exemption began to phase out at $1,020,600).
For tax year 2020, the adjusted gross income amount used by joint filers to determine the reduction in the Lifetime Learning Credit is $118,000, up from $116,000 for tax year 2019.
For tax year 2020, the top tax rate remains 37% for individual single taxpayers with incomes greater than $518,400 ($622,050 for married couples filing jointly). The other rates are:
- 35%, for incomes over $207,350 ($414,700 for married couples filing jointly);
- 32% for incomes over $163,300 ($326,600 for married couples filing jointly);
- 24% for incomes over $85,525 ($171,050 for married couples filing jointly);
- 22% for incomes over $40,125 ($80,250 for married couples filing jointly);
- 12% for incomes over $9,875 ($19,750 for married couples filing jointly).
Written by Stephen J. Silverberg, Attorney at Law, Founder of the Law Office of Stephen J. Silverberg, located in Roslyn Heights, New York. Attorney Silverberg is a Member of the National ElderCare Matters Alliance, and he and his firm have a Featured Listing on ElderCareMatters.com – America’s National Directory of Elder Care / Senior Care Resources to help families plan for and deal with the issues of Aging.
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