2009 Tax Brackets Announced

Thanks, some great information for a post I am writing on this subject. Good to see the thresholds have increased from 2008..

Why not put the Tax Brackets in your Article

Good point. I have updated this article to include a table of the 2009 tax brackets

Where is the rule that states one must pay income tax? I can’t find it. I’ve found property tax, sales tax and corporate tax, but no income tax.

Section 1 of the Internal Revenue Code.

Agreeing with b-man. The very first sentence in the Internal Revenue Code, section 1, reads “There is hereby imposed on the taxable income…” and proceeds to enumerate the various tax rates imposed on different types of income and different types of individuals.

I wish our leadership would grow some and just envoke an even tax rate and get rid of all the B.S. called tax codes……….Everybody just pay the same percentage no matter how much you make and get on with our lives!

That would make the math simpler, but it might not make filing any simpler unless we also get rid of various deductions and tax credits. That’s the part that really makes things complex, because with deductions people need to keep track of receipts and so forth. If we could have one universal rate with no deductions, that would create the ultimate in simplicity.

b-mann is actually asking where the IRS got the authority to tax income. I could write a document claiming the imposition of a tax on the residents of Montana, but I’d have no legal grounds to enforce it. Ultimately, he’s arguing that the 16th amendment to the Constitution — which is the legal basis for Federal collection of income tax — was illegal. While the details of the argument are actually pretty interesting, practically, no one has ever won a case based on them, and so the question is practically immaterial.

“When the people fear the government there is tyranny, when the government fears the people there is liberty” It’s sad and obvious that the vast majority of people who reside in the United States are to apathetic or complacent to make their voices heard… Unfortunately it looks like we are headed for socialism. The founders of this country would be sick!

“I smell a Rev”, I like you.

This socialist swing must stop, it puts the soul of our great nation at risk.

<3America, love it or leave it.

Hey all; I apologize for not understanding the rules of taxation: I’m in the third tax bracket (25%) because I make 52,000 before tax. Now, the 25%, is this taken bi-weekly; or, is the 25% tax taken as an anual amount?

The reason I question this: if 25% is taken out of each paycheck, my yearly take home is 38,997. If taken out of my anual income i take home 48,672.

Only what you make over $33,950 is taxed at 25% if you are filing single. Then $3,850 for the second bracket and $835 for the first. For $52,000 you would owe $9,197.50. How you got that you would owe $3,328 for your annual income is a mystery.

im single and all but why did they move up the married brackets? they used to be just double the single. well they are for the first few brackets this time but then…. guess socialist countries need that tax rev. i always believed i can spend my money more wisely than the fed, give it to the people and the recession be over. the failure of businesses would have been swift and in the past by now.

What is the difference between “LTCG/QD tax rates” far right on chart and “tax rates” far left on chart?

The tax rate in the The LTCG/QD column refers to the tax rate on long-term capital gains and qualifying dividends, which is lower than the tax rate imposed on other forms of income.

I don’t understand the married thing either..It looks like 2 people making $80,000 should stay single.

FYI, I’m a Illinois resident.

Where does it state in our U.S. Constituition that we are required to pay a ‘State Income Tax’?

Please help me out. I’ve paid it for decades, however I’ve never found a law stating that we are required to pay a state tax…

Thanks
Peezy
-Word is Bond…

Have you ever read the U.S. Constitution? If not, you might want to check it out, specifically the 16th Amendment regarding income taxes!

Regarding State income taxes, you would refer to your state’s constitution or laws for that matter. All powers not regulated by the federal government are passed onto the individual states.

A flat tax (5%) with no returns, write offs, exemptions or forms. The IRS now monitors the employers to insure that they are indeed deducting them, no jobs lost there. Everyone, with only Active Duty Military, retired (65 & up unless they want to work & then INCOME only {above established poverty limits}) Politicians too! Now to help this work we need to revamp the penal system, the new “Workfare” program (replaces welfare), and a host of others that some had actually believed Mr BO would do (that still cracks me up). Bottom line, birth does not infer privelages and no one OWES you a thing. People want “IT” fixed; however, this countries moral compass is so out of whack that it just taint gonna happen! Oh, sorry, we were discussing taxes… Never Mind! God Bless you all.

I was offered a position as a pure 1099 employee where all payment of taxes would be left up to me to manage throughout the entire year. Is there a manual, guide, or book that discusses how this can or should be accomplished. If I take this position I want to make sure I plan to pay my taxes accordingly.

That’s why I live in Nevada. No state income tax! We can piss and moan all day long about the troubles we face as Amricans, but the fact remains: We can only do whatever the bigwigs in charge tell us to do, otherwise feel the end of a nightstick from the knucklehead fascists wielding them called police officers.

the 15% bracket list up to 33,950. Is this amount refer to your adjusted gross income.

Never mind, should have looked closer, it refers to your taxable income

The tax table here suggests that a person with taxable income of greater than $372,950.00 has to pay 35% tax for income greater than 372.950.00
However a companion web site says it is 35% plus about $100000.00
Can you please clarify?

chan, the tax rates in the table above are marginal tax rates. The rates apply to each of the income ranges listed. In a separate page, I break down the 2009 tax rates to indicate how tax is calculated in each bracket. That’s why you’ll see an additional amount listed, which reflects the taxes calculated from the lower tax brackets.

Pure 1099, You would have to make quarterly payments based upon estimated income. If you pay within 10% of what you owe, you are to make it up on the April 15th date. If pay in too little, less than 10% of what you owe, you have to pay 1 what you owe plus 2 interest and you get a 3 penalty. Make sure oyu pay in enough on those quarterly payments and you should be fine. All of the documentation is available on the US Treasuries web site.

for Pure 1099 — This article only discusses Income Taxes. As a 1099 employee, you are essentially your own small business. As such, you are responsible for BOTH income taxes and Social Security/Medicare taxes. Not only that, but Social Security taxes are assessed on both the employee and the employer. Since you are your own business, you are responsible for paying both parts. So, in your estimated tax planning, you’ll find that something like 15% of your income has to be set aside for Social Security/Medicare taxes. There is one piece of good news — you get to reduce your 1099 income by any business expenses that you incur, so get some guidance from someone who understands this (or at least from IRS publications), and keep track of ALL your business expenses! I’ve seen people get burned at tax filing time because they didn’t understand the impact of Social Security taxes on their 1099 income and end up owing a lot of money.

If there is no state tax, then you get a higher sales tax, so there is no getting around it. the sales tax in Wa. is almost 10%. The last thing I want to see is the state not having money. If they cant pay for law enforcement, then law enforcement has to pay for itself which means double the money for tickets, and every other retarded violation. No one wants to pay taxes, but everyone wants someone to point the finger at when there is a problem in their state. There are people that we pay to take the blame. They may not be the smartest, but thats why we vote. I’m not against taxes at all, I’m against the government being able to raise them whenever they choose.

On the issue of married rates, I think the rationale behind this is an assumption that the 2 spouses will not have 2 equally paying jobs. If one spouse makes $66k and the other $34k, their taxes as a couple end up being about the same as if they were single. If the difference is greater (say $80k and $20k) they end up paying less as a couple than they would as 2 single people. If their incomes are closer (say $55k and $45k) they end up paying more as a couple. Bummer for those couples, but hey, during years that one spouse is out of work, you’ll pay much lower taxes than you would if you stayed single, and married couples get all other sorts of benefits. There’re plenty of gay people who would love to get married even if they had to pay more in taxes. I say we let them. Maybe all those extra taxes that gay couples pay will lower the deficit.

One thing that jumps out at me is the large jump from the 15% to 25%. All the other brackets are 2-5% increments. And, the 25% bracket covers a pretty wide range (most of the middle class). It seems you could easily fit a 20% bracket in there and smooth it out a little.

I have a few questions I’m hoping someone can answer:

1) If I’m married filing jointly, & I am also head of household, am I able to make up to $113, 400/yr & still be in the 15% tax bracket?

2) I have 5 dependants (4 kids & stay at home wife). We usually receive earned income credit for I believe 2 of the kids. How are the earned income credits affected by my total income &/or my tax bracket?

3) If I have short term financial gains via the stock market, are these taxed at my prevailing tax rate, or at a higher rate?

Thanks much in advance!
Gary

My question is: I draw a SSI and social security. I am considered disable. I do not pay taxes on my social security. and it is not all that much. Now If I win money at the casino, do I have to file taxes? small amounts of money, well like 4 or thousands a year.

The jump from 15% to 25% is just torture! Why is the middle class being punished? And why is the middle class still accepting this?

The middle class is not being punished. The rich are the one that’s are getting the shaft. Let’s tax the rich and businesses to pay for Obamacare and all the other socialist programs. People in America need to stop feeling entitled.

I have heard that the Obama administration has changed the tax laws for those who decide to borrow against their 401K. Does anyone know if there is any truth to this? From what I have heard, you still pay the 20% early deduction fee, but there is no additional income tax paid. Of course this dependent on how much you take out. Thanks in advance.

If I am head of household, and only made $ 11,250 in 2009. No other earnings, wife, no kids, am I in the 0% category or in the 10 % category? I’ve been working as a freelancer all year and no taxes have been deducted out of my paycheck. I need to know how much I need to pay back to the IRS.

Can someone help me with my tax issue?

Currently, I’m looking at $34,500.00 TYD wage from my work and $2,000.00 for interest from the savings. That will put me into 25% tax bracket(single), but I also paid $7,000.00 for my mortgage interest. Will my mortgage interest drop my tax rate from $25% to 15%?

Thanks

The interest on your mortgage is an itemized deduction, which is below the line. It will not affect your Adjusted Gross Income (”the line”), which is what determines your marginal tax rate, so this will in no way impact your marginal tax rate.

Matt, you are quite right. The tax rates are based on your taxable income. So if you are itemizing, the tax rate(s) that apply is based on your income minus all your deductions. From what you said, it does look like you’ll be in the 15% tax bracket.