While many of the commercials you see on television are about the holiday season, it is important not to forget that the New Year is just around the corner. With 2016 coming, there are a number of changes that will take effect involving the U.S. Tax Code. Many of them will be beneficial to individual taxpayers, even though they may be slight in nature.
Nevertheless, knowing about them sooner rather than later can help as you prepare your tax returns. This post will highlight a few of the many changes described through a recent USA Today report.
You can contribute more to HSA’s in 2016 – With the cost of health care going up next year, the federal government will allow additional contributions to health savings accounts to help in defraying the cost of medical treatments. The maximum contribution for family HSA’s will rise to $6750; up $100 from last year.
Personal exemptions will go up – In the same vein, the personal exemption that taxpayers can use to lower their taxable income will increase as well. Next year it will be $4050; up $50 from last year.
Tax bracket increases will take effect – The tax brackets that govern how much a taxpayer pays in taxes will also increase in 2016. The .4 percent increase may not seem like much, but the separation into another, less costly tax bracket could be huge.
Extra time to file taxes – In 2016, April 15 falls on a holiday; Washington D.C.’s “Emancipation Day.” Under federal law, whenever April 15 falls on a weekend or holiday, the tax filing deadline falls on the next business day; which will be April 18 next year.