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With just over a month left in 2009, it’s time to start thinking about your finances in 2010. Back in late October, the IRS released details regarding income tax changes for 2010, including (very slightly) modified income tax brackets. Here’s a quick rundown.
Federal Income Tax Brackets 2010
Here’s a quick rundown of Federal income tax brackets for 2010. If you compare to the 2009 income tax brackets, you’ll see that they’ve hardly changed at all:
|Tax Bracket||Married Filing Jointly||Single|
|10% Bracket||$0 – $16,750||$0 – $8,375|
|15% Bracket||$16,750 – $68,000||$8,375 – $34,000|
|25% Bracket||$68,000 – $137,300||$34,000 – $82,400|
|28% Bracket||$137,300 – $209,250||$82,400 – $171,850|
|33% Bracket||$209,250 – $373,650||$171,850 – $373,650|
|35% Bracket||Over $373,650||Over $373,650|
A few other points:
- Personal and dependency exemptions will be unchanged at $3650
- The standard deduction for heads of household increased from $8350 to $8400, but will remain unchanged for others
- The gift tax exclusion will remain unchanged at $13000
Minimizing your income taxes
Regardless of what the income tax brackets look like next year, you should start planning now to minimize your tax hit. Be aware (and take advantage) of the most common income tax deductions as well as those commonly missed tax deductions. Adopt tax efficient investment strategies. And be sure to take advantage of perks at work like a flexible spending account (FSA) or a health savings account (HSA).
- Find and apply for zero percent balance transfer credit cards with no annual fee and the longest 0% APR terms.
- Open a high yield online savings account to make your money work harder for you.
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