- Put up to $19,500 in your workplace 401(k) plan, plus another $6,500 if you’re 50 and over in 2020. This also lowers your taxable income.
- The standard deduction for single filers will be $12,400. It rises to $24,800 for married couples filing jointly.
- Giving away wealth? An individual can transfer up to $11.58 million free of estate and gift taxes in 2020.
It's never too early to resolve to save more for retirement and trim your tax bill.
The IRS has made inflation adjustments to a range of key figures, from the amount you can put in a 401(k) retirement plan at work to the individual income tax brackets that help you determine your tax rate.
See below for your new tax bracket in 2020.
Pay attention to your standard deduction for the 2020 tax year. The IRS has bumped it to $12,400 for singles, up from $12,200 in the prior year.
The standard deduction for married joint filers will be $24,800, up from $24,400 in 2019.
The additional standard deduction for older taxpayers and those who are blind are still available.
Workplace retirement savings
Resolve to save a few extra dollars in your retirement account at work.
The IRS has raised the employee contribution limit for 401(k), 403(b) and most 457 plans to $19,500, up from $19,000 in 2019.
If you’re 50 or older, you can save an additional $6,500. That’s up from $6,000 in 2019.
The contribution limit for individual retirement accounts, whether traditional or Roth, is holding steady at $6,000, plus another $1,000 for savers 50 and over.
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