HOW TO REVIEW REDUCTION IN INCOME TAX RATES

TEMPORARY REDUCTION IN INCOME TAX RATES EXTENDED:

Today's topic is the temporary reduction in individual income taxes.  If you would like additional information on this topic, please call my office at: (916) 601-5270

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Reduction in Income Tax Rates

Reductions in income tax rates in excess of 15% were scheduled to remain in effect through 2010, at which time they were subject to "sunset" provisions, meaning that income tax rates would revert to 15%, 28%, 31%, 36% and 39.6% after 2010.  The 2010 Tax Relief Act, however, extended the lower income tax rates through December 31, 2012. 

Income Tax Rates

Tax Years	Lowest Bracket	2nd Bracket	3rd Bracket	4th Bracket	5th Bracket	Highest Bracket
2011 - 2012	10%	15%	25%	28%	33%	35%
2013 and later	No 10% bracket	15%	28%	31%	36%	39.6%

Planning Note:

Consider using tax savings to fund an IRA, 401(k) or other tax-favored plan.

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10% Tax Bracket

The availability of the 10% bracket was scheduled to expire at the end of 2010, after which the lowest tax bracket would be 15%.  Thanks to the 2010 Tax Relief Act, however, the 10% tax bracket has been extended through 2012.  If "sunset" provisions take effect at the end of 2012, the 10% bracket will disappear and the lowest tax rate will be 15%.

10% Tax Bracket Thresholds

Filing Status	2011 - 2012	2011 and later
Married, Filing Jointly	$14,000 ($17,000 in 2011)	No 10% bracket
Single Taxpayers	$7,000 ($8,500 in 2011)	No 10% bracket

Brought to you by:

Randy Taylor

Randy Taylor Financial Services

Gold River Drive

Gold River, Ca 95670

916-601-5270

cycle.1@live.com

http://finsecurity.com/RTaylor

The purpose of this newsletter is to provide information of general interest to our clients, potential clients and other professionals.  The information provided is general in nature and should not be considered complete information on any product or concept described.  For more complete information, please contact my office at the phone number above.