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

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.

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.

Can anyone answer a quick question? If I am paying into a deferred compensation account for retirement do I need to be paying taxes or include this in my taxes?

hpg1, it depends on the type of deferred comp. plan. Generally, saving contributions to tax-deferred plans such as traditional 401(k) and 403(b) plans are pre-tax for federal and state income taxes (but not pre-tax for Social Security and Medicare taxes). Contributions to post-tax plans such as Roth 401(k) are not pre-tax. Generally the accounting for this is handled by your employer so there wouldn’t be too much to worry about.

Are these tax brackets based on gross income or adjusted gross income?

The effective tax rate that is calculated on turbo tax is based on teh adjusted gross income.

The economy will never recover because the working class is taxed to death. 25% of my income for Federal taxes is rediculouse. When you also pay 7% or more in social security taxes and state taxes, then you also pay medicar taxes. I work hard for a living. I have to work overtime to survive. The cost of living doubled during the Bush years. We Now pay twice as much for gas/for our cars/ twice as much for electricity, and groceries/ During this huge increase in the cost of living our wages either stayed the same or went down. Now the government has the nerve to raise taxes on the working class who can no longer live on their income/let alone save for retirement. We are in a recession because now when you get paid you can only afford bear neccessites, and to pay some of your bills. You have nothing left to spend anywhere. I think you filthy rich politicians who continue to raise taxes on the working class need to pay more taxes and learn to live like the working people that work hard and have nothing to show for it. The Federal government alone takes enough out of me to pay cash for I think is an expensive car evry year. But I the one who works hard for a living can’t even affprd a car by the time the Government is done taxing me to death.

Cherie, I agree with you. We’re being taxed to death by the ruthless politicians and their minions (bureaucrats) to pay for their thievery. It’s time to get out the pitchforks and the national razor (like the French in 1789) — more effective than a Boston Tea Party. In 1972, I earned $11, 720 — and on that I could buy a new Lincoln ($3,000) and a house ($35,000). The wars and Wall Street have bankrupted the nation. Only the rich have benefited, esp. the Texas oilmen and Wall Street thieves. And we’re sending our money (bribes for resources) to all the third world cesspools (Egypt, Iraq, Afghanistan, Nigeria) in the world.

Short of a Rev. nothing will ever change. You have to remember that the current tax system is all about government control, wealth redistribution and votes.

I have a question that I hope someone can answer. Lets say I made $8,349 in one year. They’ll only tax me 10% of what I made. I know i’ll be able to qualify for EITC and I claimed 0… for the life of me I’m not good at math, what would I be getting back?

Actually the constitution says the government can tax income. However, at the time the constitution was written, income was defined as corporate income only, whereas the proper term (at that time, and today) for individual income is called ‘wages’.

Nothing in the constitution says that wages must be taxed at the federal level, which means that they have simply redefined the word income to apply to corporations and individuals, whereas it was written to be for corporate income only.

Question: I’m a dentist with some control over what I take home vs. what stays in the business. Am I interpreting things right when I say that if I’m married filing jointly I’m better off paying myself just under 208,000 (28% goes to taxes), rather than just over, (33% goes to taxes)?

Did your income also inflate from 1972? If it’s at 70K then at least it’s kept up with inflation. Have tax rates gone up since then, too?

actually, it is in the constitution that taxes are optional. but if you do not choose the option to pay, you go to jail. Nice country huh?

I collected 14500 of unemployment benefits none of the amount were taxed. My total income for 2009 will be 14500 and I will file a married/joint status. Do you think I have to pay for any taxes? PLEASE HELP!!!

I am filing, married filing jointly. What would we pay on the first $67,900.00. And what would we pay on the amount over $67,900.00?

Looking for information about my tax bracket, I read:

25% on the income between $33,950 and $82,250; plus $4,675

Would someone please be kind enough to tell me what that “plus $4,675″ means? My income will be approx 39k.

Thank you.

Pam, the “plus $4.675″ means the total amount of income tax from the lower tax brackets. So someone in the 25% tax bracket has some of her income taxed at 10%, some at 15%, and some at 25%. The easiest way to calculate this by hand is to take 25% of your income above the threshold for that tax bracket, and then add in the tax from the 10 and 15 percent brackets.

When you are self-employed, do you have to pay the taxes as specified to your tax bracket PLUS self-employed taxes?

Yes. I provide some tips about the self employment tax in a separate article.

So, I’m reading people’s comments that they don’t feel taxes are “fair” or maybe that they shouldn’t have to pay them at all?
If we all stop paying taxes, do you think that the trash will be removed from your street, the roads will be fixed, mail will be delivered, cops will arrest the person that killed your brother, the DA will prosecute that same person, the TSA will (try) to create a safe environment in the airline industry, etc etc.
I’m not saying that our tax money is being spent effectively and maybe it is coming time for a “revolution”. It’s important that we do more than type onto blogs. Remember to vote locally and nationally… and maybe take some action beyond voting.
thanks.

what does the QW next to married mean? I am married with no children which one would i fall under?Head of householr or married filing jointly?

QW stands for Qualifying Widow(er)

All you losers who have no job and collect welfare…your welcome!!!!!!!!!!!!

Tim, just because people have lost their jobs does not make them losers.

I make $43875..If I calculated it right I should owe $3970…can anyone tell me if I did this correctly?

yes there is no law you should file a 1049 for income taxs
but there is a law that you must pay income taxs or go to jail sorry!!

FairTax.org

I think that with more people making well over $372,000/year, there should be several more tax brackets. Someone who makes $375,000 is paying the same rate as CEO’s who are bringing home millions.

Ive lost my job and was on unemployment this year, i made 15,249, none of it taxed, i have a wife and 1 3 yr old child, and no other income, do i pay taxes and if so how much will i have to pay, im having a hard time fguring it out. and ive never had to ay taxes before so can u help me out?

I recieved 15,249 in unemployment, none of it taxed, i have no other income i have a wife and a 3 yr old child, and not sure how much i will hve to pay in taxes or wut i should do about payin txes sinc ive never had to pay them

My Significant Other of 10 years and I have decided to NOT get married because we will be significantly penalized on our taxes. We both work and have good incomes. Where is the fairness in this? ‘I Smell a Revolution’ is right. SOMETHING smells around here! (Hint: they run this country) I’m all for a flat tax for everyone – EVERYONE and NO EXCEPTIONS or loopholes!

Hey, Number 50, BRAD, You need to look at Roth IRAs. Or get a REASONABLE accountant if you don’t undersand or have time. My brother is a doctor, put himself through school and my father could not afford to help him. HE IS TAXED TO DEATH…and let’s not talk about the liability insurance premiums he pays!!!! Good luck!

I thinking about going into full time ministry as a minister. Can you explain what bracket I would be in?

I discovered much to my horror yesterday that my company never took out Federal withholding for the whole year based on the new thresholds. I’m single and have always claimed 5. What do I do now? I had not planned for this. Also, when you have to pay, will the reduced taxes be reflected in what you have to pay back? HELP!!! I need some advice.

Have any of you people heard of H.R. 25 – FairTax Act of 2009? It is currently sitting in the House Ways & Means committee. You can read the entire 133 page bill in one sitting.
How about not having to file an individual tax return ever again? How would you like to have to never keep a receipt? How would you like to keep your entire paycheck and pay your Federal tax only at the point of sale of new goods and services?
Check it out at http://www.fairtax.com.

im the 2nd tax bracket filin head of household. i dont know didly about this stuff so if i made about 12,000 and i didnt pay any taxes but i wish to file my taxes. would they tax it? how much would i get back? how much would they take. would i have to pay in is what i really need to know?

The married tax bracket was designed when families had a single earner, or the husband made significantly more than the wife. So they were allowed to pool their income and in effect, split it in two, and use both deductions. But they were not allowed a complete halving because that would be unfair to single filers. (a couple making 80K a year if totally divided in two would be taxed on each half at 15% – vice 25% for a single guy).
It is the change to dual income families that changed – and tax code should probably change to reflect that. But just like the AMT, politicians love to use it as a campaign speech too much to change it.

I guess we should do like most people and not work and not pay taxes and let obama support us this is ridiculas people we need to stand up and be counted,remember they gave thereselfs a raise I guess that what the increase is for,this country is now designed for the goverment and not for the people

Marianne-If you claimed 5, then you probably won’t owe much taxes anyway. The lower the number (0 is the lowest) the more they take out in taxes. If you don’t have 5 exemptions and you are claiming 5, then you might owe. It depends on your income.

I work overseas in iraq, and I make about 150k a year. so, if i get a taxbreak of 92,500 or so, why the heck am i paying 30% tax on the differance?

also, on my vacation, I pay for a hotel out of pocket and expences. And then I expence this with my company. But i have just learned, they are adding that expense back onto my income.

my question about that is, am I now going to get taxed on that amount at 30%? And since they reimburst me the amount of my expenses, am I suppose to “write off” the taxes on that amount? or just write off the complete expense even tho they reimbursted me for it.

very confused about company travel and taxes….

@ #59

All those things you mentioned are paid for by OTHER TAXES … let’s see … I get a garbage collection bill which also includes taxes on that amount … the roads are fixed by the taxes I pay when I bought my car, registered my car, bought my DL, renewed my tabs, went through the toll and every time I fill up the tank … my mail is delivered when I pay for stamps … the cops that killed my brother are paid by their obsessive ticketing, fining and confiscation of private property … and the TSA that treats us like terrorists yet cannot seem to use any common sense to catch terrorists are paid for by increasing the price of my ticket with 9/11 surcharge fees!!!!

Do you even think ?????

All the federal tax money goes to pay the interest on the federal debt … which btw cannot be paid off because all money is loaned into existence at interest yet the interest doesnt exist to pay back the loan which is why the debts and deficits grow larger each year!!!!

Get SMART!!!

when we had regan as pres, we also had bob hope and jonny cash,

now we have obama, we dont have any hope or cash!

The Sixteenth Amendment (Amendment XVI) to the United States Constitution allows the Congress to levy an income tax without apportioning it among the states or basing it on Census results. This amendment overruled Pollock v. Farmers’ Loan & Trust Co. (1895), which limited the Congress’s authority to levy an income tax.

It was ratified on February 3, 1913.

I understand NOW about the amount over $339xx is 25% etc. etc. Now a quick question. If I convert some of a regular IRA to a ROTH- does the amount just tack on at the front of my income and still go per the amount OVER $339xx @ 25, the balance (let’s say 12k @ the next lower bracket?

I was recently married and trying to decide if it’s more beneficial to file joint or separately. My wife is a student but doesn’t pay state/fed taxes since she’s employed overseas. I’m military and with our salaries combined we’re not even sure if we can claim the student loan deduction. My taxable income was $44,410. Even if hers isn’t taxable does it still count as far as household total if filing joint? Any suggestions…?

“just envoke an even tax rate and get rid of all the B.S. called tax codes……….Everybody just pay the same percentage” THAT is an excellent idea. One problem with it though. People like Bill Gates, John & Theresa Heinz Kerry, Warren Buffet, Etc… do not get bi-weekly pay checks like the general public does. Their income is on investments, holdings, capital, etc…. We would still pay more as a percentage of income then the elites of our society do.

Some of you are complaining about 25%…try paying 33% with a smiley face…I didn’t think so.

if i am 70 1/2 and i withdraw my whole roth ira what do i have to pay and how much?

Thanks I really needed this info my teacehr was gonna kill me if my work wasnt done thanks muchies.

Hi_ Sorry for the ignorant question but hopefully someone would kindly answer me. Regarding Tax Brackets, does one fit into a specific tax bracket based on gross income or after all deductions are calculated? For example, the 15% tax bracket is between $8,350 to $33,950, and the 25% tax bracket is between $33,950 to $82,250; “if” my gross income was $35,000 and my mortgage interest alone was $10,000 (net income being $25,000) would I fall into the 15% or 25% tax bracket?

Regarding the marriage “penalty”: looked at another way, why can’t we call it a single-person’s slight tax advantage? I use roughly the same utilities as a married couple in an equivalent home, but I only have one income to pay it. My rent is the same as a married couple’s living in the same place, but I only have one income to pay it, as opposed to two. The same applies to other aspects of my necessary spending.

If you look at it from a slightly different perspective, you see that rather than being a “penalty” on one group, it is a slight advantage for another group of people who don’t have the luxury of two incomes in their household.

that’s a good point!

Oh, by the way, thanks Mr. Perez, for posting the information I had been looking for originally when I found your page.

I’m 20 years old,, no experience with handling a large income,, I started a small business and did well,, over 115K first year,, I made the mistake of trying another business and lost about 35K,,,I have about 15K in rightoffs,, but that’s it,, I have no money to pay my taxes,, I haven’t even filled,,I got an extension,,, WHAT SHOULD I Do ???? What am I gonna pay?

If I sold a house in August of 2009 that I owned and occupied for 25 months. I made a profit of 19,300 then how much will I owe for capitol gains?