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2017 Tax Brackets, Standard Deduction, Personal Exemption, and Other Updates

Every year, I publish a brief update with the following year’s tax brackets, standard deduction, and so on. This year, there is more uncertainty, as the likelihood of a legislative change happening in early 2017 and actually being effect for 2017 is somewhat higher than normal. Still, what follows is the information as it stands now. If you want additional details, the official IRS announcement can be found here.

The tax brackets for 2017 are as follows:

Single 2017 Tax Brackets

Taxable Income
Tax Bracket:
$0-$9,325 10%
$9,326-$37,950 15%
$37,951-$91,900 25%
$91,901-$191,650 28%
$191,651-$416,700 33%
$416,701-$418,400 35%
$418,401+ 39.6%

 

Married Filing Jointly 2017 Tax Brackets

Taxable Income
Tax Bracket:
$0-$18,650 10%
$18,651-$75,900 15%
$75,901-$153,100 25%
$153,101-$233,350 28%
$233,351-$416,700 33%
$416,701-$470,700 35%
$470,701+ 39.6%

 

Head of Household 2017 Tax Brackets

Taxable Income
Tax Bracket:
$0-$13,350 10%
$13,351-$50,800 15%
$50,801-$131,200 25%
$131,201-$212,500 28%
$212,501-$416,700 33%
$416,701-$444,550 35%
$444,551+ 39.6%

 

Married Filing Separately 2017 Tax Brackets

Taxable Income
Marginal Tax Rate:
$0-$9,325 10%
$9,326-$37,950 15%
$37,951-$76,550 25%
$76,551-$116,675 28%
$116,676-$208,350 33%
$208,351-$235,350 35%
$235,351+ 39.6%

 

Standard Deduction Amounts

The 2017 standard deduction amounts will be as follows:

  • Single or married filing separately: $6,350
  • Married filing jointly: $12,700
  • Head of household: $9,350

The additional standard deduction for people who have reached age 65 (or who are blind) is $1,250 for married taxpayers or $1,550 for unmarried taxpayers.

Personal Exemption Amount and Phaseout

The personal exemption amount for 2017 is $4,050.

However, the total personal exemptions to which you’re entitled will be phased out (i.e., reduced and eventually eliminated) as your adjusted gross income (i.e., the last line of the first page of your Form 1040) moves through a certain range.

  • For single taxpayers, personal exemptions begin to be phased out at $261,500 and are fully phased out by $384,000.
  • For married taxpayers filing jointly, personal exemptions begin to be phased out at $313,800 and are fully phased out by $436,300.
  • For taxpayers filing as head of household, personal exemptions begin to be phased out at $287,650 and are fully phased out by $410,150.
  • For married taxpayers filing separately, personal exemptions begin to be phased out at $156,900 and are fully phased out by $218,150.

Limitation on Itemized Deductions

As was the case for the last few years, the amount of itemized deductions which you are allowed to claim is reduced by 3% of the amount by which your adjusted gross income exceeds certain threshold amounts. These threshold amounts are the same as the lower threshold amounts listed above for the personal exemption phaseout (e.g., $261,500 for single taxpayers). However:

  1. Your itemized deductions cannot be reduced by more than 80% as a result of this limitation, and
  2. Your itemized deductions for medical expenses, investment interest expense, casualty/theft losses, and gambling losses are not reduced as a result of this limitation.

IRA and 401(k) Contribution Limits

For 2017, the contribution limit to Roth and traditional IRAs is unchanged at $5,500, with an additional catch-up contribution of $1,000 for people age 50 or older.

The contribution limit for 401(k), 403(b), and most 457 plans is unchanged at $18,000, with an additional catch-up contribution of $6,000 for people age 50 or older.

The maximum possible contribution for defined contribution plans (e.g., for a self-employed person with a sufficiently high income contributing to a SEP IRA) is increased to $54,000.

AMT Exemption Amount

After adjusting for inflation, the following are the AMT exemptions for 2017:

  • $54,300 for single taxpayers,
  • $84,500 for married taxpayers filing jointly, and
  • $42,250 for married taxpayers filing separately.

For More Information, See My Related Book:

Book6FrontCoverTiltedBlue

Taxes Made Simple: Income Taxes Explained in 100 Pages or Less

Topics Covered in the Book:
  • The difference between deductions, exemptions, and credits,
  • Itemized deductions vs. the standard deduction,
  • Several money-saving deductions and credits and how to make sure you qualify for them,
  • Click here to see the full list.

A testimonial from a reader on Amazon:

"Very easy to read and is a perfect introduction for learning how to do your own taxes. Mike Piper does an excellent job of demystifying complex tax sections and he presents them in an enjoyable and easy to understand way. Highly recommended!"
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