New inflation estimates from Wolters Kluwer offer first look at impact for taxpayers in 2021

Quick, go-to guidance on latest figures now available.

An early glimpse at the income tax picture for 2021, as projected under current tax law, is now available from Wolters Kluwer Tax & Accounting[1]. The new information includes estimated ranges for each 2021 tax bracket as well as projections for a growing number of inflation-sensitive tax figures, such as the standard deduction. Projections are based on the relevant inflation data recently released by the US Department of Labor.
 

Inflation Adjustments – Background
Since the late 1980s, the U.S. Tax Code has required that federal income tax brackets be adjusted for inflation annually, and inflation adjustments have been inserted into the Internal Revenue Code in recent years with increasing frequency. For example, the Code now requires over 50 other inflation-driven computations to determine deduction, credit and exclusion amounts in addition to the more than 30 separate computations needed to inflation-adjust the tax bracket schedules each year. Estimates for any of the inflation-adjusted tax figures for 2021, of course, are also necessarily subject to any changes to the tax law that may be made by Congress over the course of the next year. 

Key Tax Savings, Inflation-Adjusted Projections for 2021
Projections based on the US Department of Labor’s inflation figures for the 12-month period between August 31, 2019, and August 31, 2020 suggest most taxpayers will experience a degree of inflation-driven “tax cut” savings, compared to 2020 tax filings. Here’s an example of how taxpayers will benefit in 2021 when compared to 2020 based on the inflation adjustments to the income tax brackets provided under the current tax code: 
  • Because of the income ranges bracketing, the inflation adjustments will provide an effective “tax cut” by taxing more income at lower marginal tax rates. A single filer with taxable income of $50,000 should owe $44 less next year due to the adjustments to the income tax rate brackets between 2020 and 2021
  • A married couple filing jointly with a total taxable income of $130,000 should pay $88 less income taxes in 2021 than they will on the same income for 2020 because of indexing of their tax bracket for 2021
Wolters Kluwer Tax & Accounting federal tax experts are available to discuss these projections, other inflation-adjusted tax estimates for 2021, or any other current tax topics impacting business and individual taxpayers.
PLEASE NOTE: The content of this alert is designed to provide accurate and authoritative information regarding the subject matter covered. The information is provided with the understanding that Wolters Kluwer Tax & Accounting is not engaged in rendering legal, accounting, or other professional services.

Contact: For additional information, including a copy of the full tax briefing on this topic, and to arrange interviews with Wolters Kluwer Tax & Accounting federal tax experts, please contact Bart Lipinski.

References

  1. ^ Wolters Kluwer Tax & Accounting (taxna.wolterskluwer.com)

Source URL: Read More
The public content above was dynamically discovered – by graded relevancy to this site’s keyword domain name. Such discovery was by systematic attempts to filter for “Creative Commons“ re-use licensing and/or by Press Release distributions. “Source URL” states the content’s owner and/or publisher. When possible, this site references the content above to generate its value-add, the dynamic sentimental analysis below, which allows us to research global sentiments across a multitude of topics related to this site’s specific keyword domain name. Additionally, when possible, this site references the content above to provide on-demand (multilingual) translations and/or to power its “Read Article to Me” feature, which reads the content aloud to visitors. Where applicable, this site also auto-generates a “References” section, which appends the content above by listing all mentioned links. Views expressed in the content above are solely those of the author(s). We do not endorse, offer to sell, promote, recommend, or, otherwise, make any statement about the content above. We reference the content above for your “reading” entertainment purposes only. Review “DMCA & Terms”, at the bottom of this site, for terms of your access and use as well as for applicable DMCA take-down request.

Acquire this Domain
You can acquire this site’s domain name! We have nurtured its online marketing value by systematically curating this site by the domain’s relevant keywords. Explore our content network – you can advertise on each or rent vs. buy the domain. Buy@TLDtraders.com | Skype: TLDtraders | +1 (475) BUY-NAME (289 – 6263). Thousands search by this site’s exact keyword domain name! Most are sent here because search engines often love the keyword. This domain can be your 24/7 lead generator! If you own it, you could capture a large amount of online traffic for your niche. Stop wasting money on ads. Instead, buy this domain to gain a long-term marketing asset. If you can’t afford to buy then you can rent the domain.

About Us
We are Internet Investors, Developers, and Franchisers – operating a content network of several thousand sites while federating 100+ eCommerce and SaaS startups. With our proprietary “inverted incubation” model, we leverage a portfolio of $100M in valued domains to impact online trends, traffic, and transactions. We use robotic process automation, machine learning, and other proprietary approaches to power our content network. Contact us to learn how we can help you with your online marketing and/or site maintenance.

Share