New IRS Tax

Income tax brackets and other tax items are being updated for a condition known as bracket creep for the tax year of 2015.
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There are additional tax updates that are included in your tax assessment for the year 2015. Most of the new rates are based on an inflation formula that includes a standard increase in the cost of living, along with some increase in the amount of income that you may earn from year to year.

Indexing Up of Brackets
Most of the tax brackets that you will use to calculate your own taxes for the year 2015 will include adjustments for inflation that are added from year to year. This means that you could be earning more money based on your employer’s adjustment for inflation, and this newer income amount is not penalized by your tax code. The tax tables have their own inflationary adjusted that takes into account your employer’s inflation changes. The following information can help you calculate your own 2015 taxes:

Bracket creep has been eliminated in the new IRS tax tables for the year 2015. Your tax bill should be lowered by including more tax payer incomes in lower tax bill brackets.
A tax calculation for the year 2015 uses two dollar figures that are added together to determine your tax bill that you owe. A dollar figure for each tax bracket is the sum of the taxes due for all of the lower tax brackets.New IRS tax 2015

A marginal tax rate is, also, used and this rate is a percentage that is multiplied by the income that exceeds the top figure in your specific tax bracket.

These two figures, a summary tax amount and your marginal tax rate, are added together to determine the amount of tax that you owe.

Adjusted Gross Income
An adjusted gross income amount is provided for each tax payer. There are the following deductions that can be used to lower your own tax bill:
The standard deductions and personal exemptions for the tax year 2015 have moderately increased over the tax year 2014 levels.

There are educational credits that can be used as personal exemptions. Your medical insurance premiums and expenses can be used as exemption costs.

Your employer IRA contributions can be added into your own personal exemption deductions and used against your personal gross income amount.

Most of the home business deductions remain the same. You can use the percentage of your home that is your business office as a personal business deduction, if you file your taxes as a self employed individual. Your business expenses for a home based business can include your business percentage for your electric bill, office overhead and car expenses. You will need to keep good records of your gas expenses and your car mileage. This can be done by keeping your gas expenses on a particular credit card, for example. Some tax credits that you are afforded for the year 2015 have been adjusted for inflation as well.

Your 2015 tax bracket has a mandatory annual indexing that is based on inflation. This new adjustment helps to prevent a financial condition called bracket creep that pushes individuals into higher tax brackets due to income increases.