2014 Tax Planning
It's almost 2014, so it's time to start planning for next year's taxes. There are a few tax changes for 2014 that will affect our " free money ." Here they are: The Standard Deduction (married filing jointly) will rise from $12,200 to $12,400 The Personal Exemption will increase from $3,900 to $3,950 The 10% Tax Bracket will increase from $17,850 to $18,150 The Health Savings Account maximum for a family will increase from $6,450 to $6,550 *Use this source to create YOUR tax plan. Here is our 2014 tax plan. As you can see, the first $34,250 of income should be tax-free thanks to our standard deduction, 3 personal exemptions and 1 child tax credit. We then add in the remaining 10% tax bracket ($18,150 - $10,000 = $8,150) since our goal is to limit our taxable income to the 10% bracket. Ideally, our AGI for 2014 will be $42,400 since it will result in a federal income tax of $815 ($8,150 * 10%). Finally, we ...