Miscellaneous Changes
Roth 401(k).
As of 2006, a Roth 401(k) option can be included in a 401(k) retirement plan. This is now a permanent option. Roth contributions are made after-tax instead of pre-tax, but distributions are tax-free. Employers may want to consider offering this option in their plan for their employees.
Zero Percent Capital Gains Rate.
For tax years beginning after 2007, the 5% maximum tax rate on qualified dividends and net capital gain is reduced to 0%. The 15% maximum tax rate on qualified dividends and net capital gain has not changed.
New Mileage Rate (January 1, 2012).
The standard mileage rate beginning January 1, 2012 is: 55.5 cents per mile for business miles driven, 23 cents per mile for medical or moving purposes, and remains 14 cents per mile driven in service or charitable organizations.
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7/1-12/31/08
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1/1/09
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1/1/10
|
1/1-6/30/11
|
7/1-12/31/11
|
1/1/12
|
|
|---|---|---|---|---|---|---|
|
Business
|
$0.585
|
$0.55
|
$0.50
|
$0.51
|
$0.555
|
$0.555
|
|
Medical/Moving
|
$0.27
|
$0.24
|
$0.165
|
$0.19
|
$0.235
|
$0.23
|
|
Charitable
|
$0.14
|
$0.14
|
$0.14
|
$0.14
|
$0.14
|
$0.14
|
2011 Inflation Adjustments.
Revised dollar amounts for tax provisions to keep pace with inflation.
- Personal and dependent exemption - $3700, up $50 from 2010
- Standard Deductions - $11,600 Joint or qualifying widow(er) (up $200), $5,800 Single and married filing separately (up $100), and $8,500 head of household (up $100).
- Tax-bracket threshold increase for each filing status.
- The annual gift exclusion remains $13,000, no change since 2008.