Annual Inflation Adjustments for 2019 Projected by Wolters Kluwer

Annual inflation-adjusted amounts for tax year 2019, as projected by Wolters Kluwer, reflect several increased thresholds and ceilings. These projections include 2019 tax brackets, the standard deduction, alternative minimum tax amounts, and several others. Wolters Kluwer bases its projections on Consumer Price Index figures released by the U.S. Department of Labor on September 12, 2018.

The Tax Cuts and Jobs Act of 2017 (TCJA) (P.L. 115-97) mandated a change from the Consumer Price Index for All Urban Consumers (CPI-U) to the Chained Consumer Price Index for All Urban Consumers (C-CPI-U).

The IRS is expected to release official amounts for 2019 later in 2018.

Individual Tax Brackets

The projected bracket ranges for individuals in 2019 are as follows.

For married taxpayers filing jointly:

  • The 10% bracket applies to taxable incomes up to $19,400
  • The 12% bracket applies to taxable incomes over $19,400 and up to $78,950
  • The 22% bracket applies to taxable incomes over $78,950 and up to $168,400
  • The 24% bracket applies to taxable incomes over $168,400 and up to $321,450
  • The 32 %bracket applies to taxable incomes over $321,450 and up to $408,200
  • The 35% bracket applies to taxable incomes over $408,200 and up to $612,350
  • The 37% bracket applies to taxable incomes over $612,350

For heads of households:

  • The 10% bracket applies to taxable incomes up to $13,850
  • The 12% bracket applies to taxable incomes over $13,850 and up to $52,850
  • The 22% bracket applies to taxable incomes over $52,850 and up to $84,200
  • The 24% bracket applies to taxable incomes over $84,200 and up to $160,700
  • The 32% bracket applies to taxable incomes over $160,700 and up to $204,100
  • The 35% bracket applies to taxable incomes over $204,100 and up to $510,300
  • The 37% bracket applies to taxable incomes over $510,300

For unmarried taxpayers:

  • The 10% bracket applies to taxable incomes up to $9,700
  • The 12% bracket applies to taxable incomes over $9,700 and up to $39,450
  • The 22% bracket applies to taxable incomes over $39,450 and up to $84,200
  • The 24% bracket applies to taxable incomes over $84,200 and up to $160,700
  • The 32% bracket applies to taxable incomes over $160,700 and up to $204,100
  • The 35% bracket applies to taxable incomes over $204,100 and up to $510,300
  • The 37% bracket applies to taxable incomes over $510,300

For married taxpayers filing separately:

  • The 10% bracket applies to taxable incomes up to $9,700
  • The 12% bracket applies to taxable incomes over $9,700 and up to $39,475
  • The 22% bracket applies to taxable incomes over $39,475 and up to $84,200
  • The 24% bracket applies to taxable incomes over $84,200 and up to $160,725
  • The 32% bracket applies to taxable incomes over $160,725 and up to $204,100
  • The 35% bracket applies to taxable incomes over $204,100 and up to $306,175
  • The 37%bracket applies to taxable incomes over $306,175

For estates and trusts:

  • The 10% bracket applies to taxable incomes up to $2,600
  • The 24% bracket applies to taxable incomes over $2,600 and up to $9,300
  • The 35% bracket applies to taxable incomes over $9,300 and up to $12,750
  • The 37% bracket applies to taxable incomes over $12,750

Standard Deduction

TCJA also roughly doubled the amount of the standard deduction. For 2019, Wolters Kluwer projects the standard deduction amounts will be:

  • $24,400 for married taxpayers filing jointly
  • $18,350 for heads of households
  • $12,200 for unmarried taxpayers and married taxpayers filing separately

AMT Exemptions

TCJA eliminated the AMT for corporations. It also increased the exemption amounts and the exemption phaseouts for individuals. For 2019, Wolters Kluwer projects the AMT exemption amounts will be:

  • $111,700 for married taxpayers filing jointly
  • $71,700 for unmarried individuals and heads of households
  • $55,850 for married taxpayers filing separately

Estate and Gift Tax, Transfer Taxes

Wolters Kluwer projects the following amounts related to estate, generation-skipping, and gift taxes:

  • The gift tax annual exemption will be $15,000 in 2019
  • The estate and gift tax applicable exclusion will be $11,400,000 for decedents dying in 2019
  • The exclusion for gifts made in 2019 to a spouse who is not a U.S. citizen will be $155,000 for 2019

Other Projected Amounts

Wolters Kluwer makes additional projections for 2019.

Adoption Credit

The projected adoption credit is $14,080 for 2019.

IRAs, Roth and Traditional

The projected 2019 phase-out range for allowed Roth IRA contribution amount is projected to phase out when income is between:

  • $193,000 and $203,000 for married taxpayers filing jointly, or
  • $122,000 and $137,000 for heads of household and unmarried filers.

The projected maximum amount of deductible contributions that can be made to an IRA is $6,000 for 2019. The increased contribution amount for taxpayers age 50 and over will, therefore, be $7,000.

Phase-out of Above-the-Line Deduction for Traditional IRAs

The 2019 phase-out of the above-the-line deduction for traditional IRA contributions is projected to begin at:

  • $103,000 for married joint filers who are both covered by a retirement plan at work;
  • $193,000 for joint filers when only one spouse is covered by a retirement plan at work; and
  • $64,000 for heads of household and unmarried filers who are covered by a retirement plan at work.

Student Loan Interest

For projected phase-out of the $2,500 student loan interest deduction begins at $140,000 in modified adjusted gross income for married joint filers, and at $70,000 for unmarried taxpayers. A married taxpayer who files a separate return cannot claim the deduction.

Foreign Earned Income Exclusion

The projected 2019 foreign earned income exclusion under Code Sec. 911 is $105,900.

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