Georgia residents and others who are getting ready for the 2020 tax year have just received critical information from the IRS. The government agency announced that the standard deduction for single filers is going to be $12,400. For those who are filing jointly with a spouse, the standard deduction will be $24,800. There are deductions available for those who are blind or who are over the age of 65 during a given tax year.
These deductions are available regardless of a person’s filing status. Income brackets have been adjusted to account for inflation. A person filing on his or her own would pay an income tax rate of 10% on income up to $9,875. Individuals who make $518,401 or more per year would be in the top tax bracket of 37%. For those who are filing jointly, they would be in the top tax bracket if they made $622,051 or more in the 2020 tax year.
Married couples filing jointly would be in the 10% tax bracket if they made $14,100 or less in the 2020 tax year. Taxpayers who have an IRA can contribute up to $6,000 in 2020 while the limit for a 401(k) or similar account is $19,500. Individuals who are 50 or older can contribute an additional $1,000 into an IRA and another $6,500 into a 401(k).
Individuals who have questions about their tax situation may be able to get information from an attorney. Legal counsel may be able to work with the IRS to get those questions answered or to resolve any tax dispute that an individual is currently engaged in. Resolving a tax dispute in a timely manner may make it possible to avoid paying interest, fees or other penalties on top of any income taxes owed.