2014 Inflation Adjustments
The tax items for tax year 2014 of greatest interest to most taxpayers include the following dollar amounts.
- The tax rate of 39.6 percent affects singles whose income exceeds $406,750 ($457,600 for married taxpayers filing a joint return), up from $400,000 and $450,000, respectively.
- The standard deduction rises to $6,200 for singles and married persons filing separate returns and $12,400 for married couples filing jointly, up from $6,100 and $12,200, respectively, for tax year 2013. The standard deduction for heads of household rises to $9,100, up from $8,950.
- The limitation for itemized deductions claimed on tax year 2014 returns of individuals begins with incomes of $254,200 or more ($305,050 for married couples filing jointly).
- The personal exemption rises to $3,950, up from the 2013 exemption of $3,900. However, the exemption is subject to a phase-out that begins with adjusted gross incomes of $254,200 ($305,050 for married couples filing jointly). It phases out completely at $376,700 ($427,550 for married couples filing jointly.)
- The Alternative Minimum Tax exemption amount for tax year 2014 is $52,800 ($82,100, for married couples filing jointly). The 2013 exemption amount was $51,900 ($80,800 for married couples filing jointly).
- Estates of decedents who die during 2014 have a basic exclusion amount of $5,340,000, up from a total of $5,250,000 for estates of decedents who died in 2013.
- The annual exclusion for gifts remains at $14,000 for 2014.
- The annual dollar limit on employee contributions to employer-sponsored healthcare flexible spending arrangements (FSA) remains unchanged at $2,500.
- The foreign earned income exclusion rises to $99,200 for tax year 2014, up from $97,600, for 2013.
- The small employer health insurance credit provides that the maximum credit is phased out based on the employer’s number of full-time equivalent employees in excess of 10 and the employer’s average annual wages in excess of $25,400 for 2013.
Beth Salvati Teaches Course on Entrepreneurship Through Operation Hope
As part of our involvement in Operation Hope, Beth Salvati recently spent a morning at Coretta Scott King Middle School in Atlanta teaching a course on planning a business. This is part of Operation Hope's program geared toward teaching young people about financial empowerment and entrepreneurship. Beth was impressed with these students and their student creed:
"As much as I attempt to calm the chaos around me called life, I can’t. I can only control myself. However, I have been told countless times that I am intelligent, courageous, strong, and beautiful. So from this moment on, every indelible mark I make upon myself or my community will embody a piece of me. That indelible mark will embody intelligence, courageousness, Strength and beauty because they are what make ME!"