Finance & Enjoyment Blog

2015 Tax Planning and Preparation: Know Key Changes to the Tax Code

Even though we are all in the 2014 tax season shuffle—compiling 1099s, W-2s, interest statements—it’s important that we pay attention to changes in the 2015 tax code because it’s never too early for 2015 tax planning and preparation. Rather than scramble at the last-minute to scrounge out 2015 tax savings before the filing deadline this time next year, a better strategy is to set things in motion now. Here are a few things to pay attention to.

Higher Flexible Spending and 401(k), 403b and 457 Retirement Account Limits

Although the deadline has passed for enrollment into most employer’s flexible spending programs, if you switch jobs, you may still be able to sign up this year to take advantage of the higher limit of $2,550 for qualified health care expenses. The limit on employee contributions to a 401(k) plan has also increased to $18,000 ($24,000 if you are age 50 or over).

Affordable Care Act Penalty

This year, the penalty mandated by the Affordable Care Act for those without health insurance coverage increased to 2% of total household income or $325 per person. Last year it was 1% of household income or $95 per person. Families can avoid this penalty by getting health insurance coverage as soon as possible.

Standard Deduction Increases and Tax Brackets Adjusted

The tax break extended to all Americans each year, the standard deduction, is also increasing for 2015 to $6,300 for single filers and $12,600 for married couples filing jointly. Income tax thresholds have also been adjusted for the 2015 tax year by 1.6% to account for inflation.

Alternative Minimum Tax (AMT) Burden Changes

The IRS created the alternative minimum tax to set a limit on the tax breaks one could claim. In 2015, families will notice a 1.5% increase from 2014 to $53,600 for individuals and $83,400 for those filing jointly.

How to Use this Information

Annual changes to the tax code keep even tax planning and preparation professionals on their toes. For most citizens, it’s impossible to keep all of the changes straight. As you finalize your 2014 return, be sure to schedule some time for 2015 tax planning and preparation to ensure you are taking advantage of opportunities to minimize your tax burden. Please give us a call at 303-815-1100 or contact us online and let us know how we can help.

How do you track the tax law changes that occur each year?

Posted in Rules and Regulations »

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