The following changes to tax items for 2013 are of greatest interest to most tax payers and include tax rate schedules and other tax changes from the recently passed American Tax Payer Relief Act of 2012 (ATRA).
- Beginning in tax year 2013, a new tax rate of 39.6 percent has been added for individuals whose income exceeds $400,000 ($450,000 for married taxpayers filing jointly). The other marginal rates – 10, 15, 25, 28, 33, and 35 percent – remain the same as in prior years.
- The standard deduction rises to $6,100.
- The personal exemption rises to $3,900. However, beginning in 2013 the exemption is subject to a phase-out that begins with adjusted gross incomes of $250,000 ($300,000/married, filing jointly), and phases out completely at $372,500 ($422,500/married, filing jointly).
- ATRA added a limitation for itemized deductions (Pease limitations) claimed on 2013 returns of individuals with incomes of $250,000 or more ($300,000/married, filing jointly).
- The Alternative Minimum Tax (AMT) exemption amount for tax year 2013 is $51,900 for individuals ($80,800/married, filing jointly). ATRA indexes future amounts for inflation.
- The maximum Earned Income Credit (EIC) amount is $6,044 for taxpayers filing jointly who have 3 or more qualifying children.
- Child tax credit at $1,000 maximum and partially refundable.