IRS Releases Inflation Adjustments for 2013

The Internal Revenue Service released annual inflation adjustments for 2013 on Monday as well as several other changes from last year’s American Taxpayer Relief Act.

In 2013, a new 39.6 percent has been added for individuals whose income exceeds $400,000, according to IRS spokeswoman Dianne Besunder. This will apply for tax returns filed in 2014.

The standard deduction rises from $5,950 to $6,100 and $11,900 to $12,200 for married couples filing jointly.

In addition, the personal exemption rises from $3,800 to $3,900. However, the exemption is subject to a phase-out in 2013 that begins with adjusted gross incomes of $250,000 – or $300,000 for married couples. It phases out completely at $372,500 or $422,500 for married couples.

The alternative minimum tax exemption amount for 2013 is $51,900. The 2012 amount was $50,600.

The maximum earned income credit amount is $6,044 for taxpayers filing jointly who have three or more qualifying children, which is up from $5,891 in 2012.

There will be an exclusion amount of $5.2 million for estates of decedents who die during 2013. In 2012, the amount was $5.1 million.

The monthly limitation regarding the aggregate fringe benefit exclusion amount for transit passes and transportation in a commuter vehicle is up from $240 in 2012 to $245 in 2013.

For further details on inflation adjustments, visit the IRS’s website.