Tax facts for 2019

[VanWinkle]

This is a good condensed version of 2019 tax contribution limits and brkts. It always helps to plan for taxes in advance!!

2019 Tax Facts – Marotta On Money

 

[statsman]

What I don't understand is why they couldn't tie the end of the 0% capital gains rate with the end of the 12% income tax rate. They are different by only $100 Single/$200 Married Filing Jointly. It would certainly make my spreadsheet simpler.

 

[Dtail]

Nice summary. Thanks.

 

[VanWinkle]

What I don't understand is why they couldn't tie the end of the 0% capital gains rate with the end of the 12% income tax rate. They are different by only $100 Single/$200 Married Filing Jointly. It would certainly make my spreadsheet simpler.

I agree with you, it would have been much easier to remember that way.

 

[ERD50]

What I don't understand is why they couldn't tie the end of the 0% capital gains rate with the end of the 12% income tax rate. They are different by only $100 Single/$200 Married Filing Jointly. It would certainly make my spreadsheet simpler.

Also agree. Does anyone know the background on this? I'll guess there were different proposals floating around, and when it went to a vote, they didn't sync up the numbers.

Most people would get in some trouble if they did this at their job.

-ERD50

 

[audreyh1]

Also agree. Does anyone know the background on this? I'll guess there were different proposals floating around, and when it went to a vote, they didn't sync up the numbers.

Most people would get in some trouble if they did this at their job.

-ERD50

People were scratching their head about this in late 2017 when the law was finalized. Those thresholds were deliberately separated, but other than clearly saying they were separated the detailed reconciliation report discussing the changes never explained why. However, it did seem that the change had occurred some time previously.

I suspect the break has to do with the upper threshold $479,000 for 20% cap gains rate. The top ordinary tax bracket was moved up to $600K. Obviously they wanted to keep a lower threshold for the 20% cap gains rate.

But still, why bother with $77,200 instead of $77,400?

 

[jebmke]

What I don't understand is why they couldn't tie the end of the 0% capital gains rate with the end of the 12% income tax rate. They are different by only $100 Single/$200 Married Filing Jointly. It would certainly make my spreadsheet simpler.

That would require legislation.

 

[statsman]

That would require legislation.

Without looking at the forms and worksheets closely, it's possible there is an issue filling out the forms if these brackets end with the exact amount. We just went through an adjustment for the 2019 tax year, and they kept the same +$100/+$200 differences.

 

[kaneohe]

What I don't understand is why they couldn't tie the end of the 0% capital gains rate with the end of the 12% income tax rate. They are different by only $100 Single/$200 Married Filing Jointly. It would certainly make my spreadsheet simpler.

It would certainly be easier to remember.................wondering why it would make the spreadsheet simpler.........just 1 extra number, right?

 

[audreyh1]

Without looking at the forms and worksheets closely, it's possible there is an issue filling out the forms if these brackets end with the exact amount. We just went through an adjustment for the 2019 tax year, and they kept the same +$100/+$200 differences.

They are all using the same new inflation index. Eventually there will be a divergence - a slight increase in the difference. Maybe by then the new rates and brackets will have expired anyway, and back to when the brackets corresponded to the ordinary tax tables. If, however, the new rates are somehow extended, there is a chance they will be reconciled then.

 

[scrabbler1]

What I don't understand is why they couldn't tie the end of the 0% capital gains rate with the end of the 12% income tax rate. They are different by only $100 Single/$200 Married Filing Jointly. It would certainly make my spreadsheet simpler.

I asked about this last week in another thread, too. Messed up my spreadsheets because I had one cell-addressed to the other.

 

[audreyh1]

It would certainly be easier to remember.................wondering why it would make the spreadsheet simpler.........just 1 extra number, right?

One extra number if your 2018 AGI is not above $479,000 for MFJ.

Last year I added the separate capital gains tax brackets to my spreadsheet rather than referencing the ordinary income tax table.

It's $488,850 for 2019. The table posted has a large error.

 

[audreyh1]

This is a good condensed version of 2019 tax contribution limits and brkts. It always helps to plan for taxes in advance!!

2019 Tax Facts – Marotta On Money

Her table is in error.

The 20% capital gains tax rate is on AGI above $488,850, not $448,850.

For shame!

I caught this error because I knew that the 2018 bracket was $479,000 and I didn't see how it could go down as it was indexed to inflation.

Now you want to check the rest of the table, don't you?