IRS Relaeases New Inflation Adjusted Tax Related items

Revenue Procedure 2011-52 was recently released.  This revenue procedure outlines most if not all of the inflation adjusted tax items such as the personal exemption amount, standard deduction, etc..  Of items of interest to farmers are as follows:

• For 2012, the 15% tax bracket ends at $70,700 of taxable income for married filing joint, $35,350 for singles,
• The standard deduction for 2012 is $11,900 for married filing joint and $5,950 for singles,
• For 2012, the personal exemption is $3,800,
• The election to expense certain depreciable assets under Section 179 cannot exceed $139,000 (but as usual Congress may change this before we have to file our tax returns in 2013),
• The Unified Credit against estate tax has increased from $5 million for 2011 to $5,120,000 for 2012.  Remember that in 2013, it is scheduled to revert back to $1 million.  Also, lifetime gifts of up to $5,120,000 can be made in 2012,
• The annual exclusion for annual gifts remains at $13,000.  This is only adjusted in $1,000 increments and it is my estimate that this number will increase to $14,000 for 2013.