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Bloomberg Tax Predicts Small 2020 Inflation Adjustments


ARLINGTON, Va., Sept. 12, 2019 /PRNewswire/ -- Bloomberg Tax & Accounting released its 2020 Projected U.S. Tax Rates report today. This report contains a detailed and comprehensive projection of inflation-adjusted amounts in the tax code based on changes in the chained Consumer Price Index (chained CPI), which were released today by the U.S. Bureau of Labor Statistics. The projections facilitate tax planning by providing early notice of the amount of tax savings that taxpayers will realize as a result of increases in deduction limits, upward adjustments to tax bracket thresholds, and increases in many other key thresholds. The full report is available at http://onb-tax.com/JG9o50w6VNO.  

Bloomberg Tax & Accounting logo (PRNewsfoto/Bloomberg Tax & Accounting)

The change to using chained CPI to measure cost of living adjustments was made by the 2017 Tax Cuts & Jobs Act. From 2019 to 2020, most inflation-adjusted amounts in the tax code, including the threshold dollar amounts for tax rate brackets, are projected to rise by less than 1.5%.

"We are projecting smaller increases for most inflation-adjusted amounts this year, as we expected, due in part to the use of the chained CPI to measure cost of living adjustments, and partly due to the slower rise in inflation overall," said Annabelle Gibson, practice lead for U.S. income tax and IRS procedure, Bloomberg Tax & Accounting. "Our projections help taxpayers and tax planners get a jumpstart on the 2020 tax planning season in advance of the Internal Revenue Service's publication of official 2020 inflation-adjusted amounts later this fall."

Individual Income Tax Rate Brackets

Bloomberg Tax & Accounting has projected 2020 income ranges for each tax rate bracket. Income ranges for the tax brackets for married taxpayers filing jointly and for single taxpayers are shown below. Rate brackets for other filing statuses are included in the full report.

Married Filing Jointly and Surviving Spouses

Projected 2020 Tax Rate Bracket Income Ranges

10% - $0 to $19,750

12% - $19,751 to $80,250

22% - $80,251 to $171,050

24% - $171,051 to $326,600

32% - $326,601 to $414,700

35% - $414,701 to $622,050

37% - $622,051 or more

Unmarried Individuals (other than Surviving Spouses and Heads of Households)

Projected 2020 Tax Rate Bracket Income Ranges

10% - $0 to $9,875

12% - $9,876 to $40,125

22% - $40,126 to $85,525

24% - $85,526 to $163,300

32% - $163,301 to $207,350

35% - $207,351 to $518,400

37% - $518,401 or more

Standard Deduction

Bloomberg Tax & Accounting has projected the following standard deduction amounts for 2020:

Filing Status

Projected 2020

Standard Deduction

Married Filing Jointly/Surviving Spouses

$24,800

Heads of Household

$18,650

All Other Taxpayers

$12,400

Alternative Minimum Tax (AMT)

Projected 2020 AMT exemption amounts are shown below.

Filing Status

Projected 2020

AMT Exemption Amount

Married Filing Jointly/Surviving Spouses

$113,400

Unmarried Individuals

(other than Surviving Spouses)

$72,900

Married Individuals Filing Separate Returns

$56,700

Estates and Trusts

$25,400

Legislative Increase in Failure-to-File Penalty

Legislation passed in July increased the statutory amount of the penalty for failure to file a return or failure to pay tax to $330 for 2020. This new amount will be the base for future inflation adjustments.

About Bloomberg Tax & Accounting
Bloomberg Tax & Accounting provides comprehensive global research, news, and technology services enabling tax and accounting professionals to get the timely, accurate, and in-depth information they need to plan and comply with confidence. Our flagship Bloomberg Tax platform combines the proven expertise and perspectives of leading tax practitioners in our renowned Tax Management Portfoliostm with integrated news from the industry-leading Daily Tax Report®, authoritative analysis and insights, primary sources, and time-saving practice tools. Bloomberg Tax & Accounting technology solutions on our proprietary Advantage platform help professionals simplify complex tax and accounting processes to better control risk and maximize profitability. For more information, visit https://pro.bloombergtax.com.

The information in this press release is not offered as and shall not constitute legal or tax advice.  In addition, the information in this press release should not be used or relied upon in connection with any actual transaction without the guidance of a professional tax adviser.

SOURCE Bloomberg Tax & Accounting


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