2021 Federal Individual Standard Deductions Investment Taxes Education ...

2021

Pocket Tables

Your guide to some of the most frequently asked for figures such as income tax rates, retirement plan limits, social security benefits and other related items.

LEGEND

S MFJ MFS

HH ET

J O MAGI AGI FRA COLA

Single Married Filing Jointly Married Filing Separately Head of Household Estates and Trusts Joint Filers Filers Other Than Joint Modified Adjusted Gross Income Adjusted Gross Income Full Retirement Age Cost of Living Adjustment

2021 Federal Individual Income Tax Rates

Tax Tables

Over...

$0 $9,950 $40,525 $86,375 $164,925 $209,425 $523,600

$0 $19,900 $81,050 $172,750 $329,850 $418,850 $628,300

$0 $14,200 $54,200 $86,350 $164,900 $209,400 $523,600

$0 $9,950 $40,525 $86,375 $164,925 $209,425 $314,150

$0 $2,650 $9,550 $13,050

But not over...

Tax ($)

Plus %

on excess

Single

$9,950

$0.00

10%

$40,525

$995.00

12%

$86,375

$4,664.00

22%

$164,925

$14,751.00

24%

$209,425

$33,603.00

32%

$523,600

$47,843.00

35%

? ? ? ?

$157,804.25

37%

Joint Returns and Surviving Spouses

$19,900

$0.00

10%

$81,050

$1,990.00

12%

$172,750

$9,328.00

22%

$329,850

$29,502.00

24%

$418,850

$67,206.00

32%

$628,300

$95,686.00

35%

? ? ? ?

$168,993.50

37%

Head of Households

$14,200

$0.00

10%

$54,200

$1,420.00

12%

$86,350

$6,220.00

22%

$164,900

$13,293.00

24%

$209,400

$32,145.00

32%

$523,600

$46,385.00

35%

? ? ? ?

$156,355.00

37%

Married Filing Separate Returns

$9,950

$0.00

10%

$40,525

$995.00

12%

$86,375

$4,664.00

22%

$164,925

$14,751.00

24%

$209,425

$33,603.00

32%

$314,150

$47,843.00

35%

? ? ? ?

$84,496.75

37%

Estates and Trusts

$2,650

$0.00

10%

$9,550

$265.00

24%

$13,050

$1,921.00

35%

? ? ? ?

$3,146.00

37%

Of the amount over...

$0 $9,950 $40,525 $86,375 $164,925 $209,425 $523,600

$0 $19,900 $81,050 $172,750 $329,850 $418,850 $628,300

$0 $14,200 $54,200 $86,350 $164,900 $209,400 $523,600

$0 $9,950 $40,525 $86,375 $164,925 $209,425 $314,150

$0 $2,650 $9,550 $13,050

Standard Deductions

Filing Status

Single individuals

2021

$12,550

2020

$12,400

Joint returns or surviving spouses

$25,100

$24,800

Heads of households

Married individuals filing separate returns

Additional standard deduction for married age 65 or older or blind*

Additional standard deduction for single age 65 or older or blind*

Maximum standard deduction for an individual who can be claimed as a dependent (cannot exceed the greater of)

$18,800 $12,550

$1,350

$1,700 $1,100 (or $350 plus earned income)

$18,650 $12,400

$1,300

$1,650 $1,100 (or $350 plus earned income)

*Taxpayers who are both age 65 or older and blind may claim twice the amount indicated as their additional standard deduction.

Federal Alternative Minimum Tax (AMT)

An alternative minimum tax (AMT) is imposed on items of income that would otherwise receive advantageous tax treatment. Taxpayers must pay the greater of (1) the AMT or (2) the regular income tax.

AMT Exemptions

Single or HH

2021

$73,600

2020

$72,900

Married filing jointly

$114,600

$113,400

Married filing separately

$57,300

$56,700

Estates and Trusts

$25,700

$25,400

AMT Phaseout Begins at

Single, MFS, or HH Married filing jointly

2021

$523,600 $1,047,200

2020

$518,400 $1,036,800

Estates and Trusts

$85,650

$84,800

AMT Rates*

2021

2020

26% rate for S, MFJ, HH, ET

$199,900

$197,900

26% rate for MFS

$99,950

$98,950

*Rate increases to 28% of AMT Base for figures greater than those listed.

Investment Taxes

Federal Tax on Capital Gains and Qualified Dividends

Long-Term Capital Gains Rate Single Taxpayer

Married Filing Jointly

0%

Up to $40,400

Up to $80,800

15%

$40,401 - $445,850 $80,801 - $501,600

Head of Household Up to $54,100 $54,101 - $473,750

Married Filing Separately Up to $40,400 $40,401 - $250,800

20%

Over $445,850

Over $501,600

Over $473,750

Over $250,800

Qualified dividends are those paid from a domestic or qualifying foreign corporation for a stock or mutual fund held at least 61 days out of the 121-day period that begins 60 days before the exdividend date. Short-term capital gains have a holding period of 12 months or less. Short-term capital gains are taxed at ordinary income rate. Long-term capital gains tax rates generally apply for sales of securities held for at least 12 months.

Threshold for Determining NII

Federal Net Investment Income Tax

A 3.8% Net Investment Income (NII) tax is imposed on the lesser of a person's NII or modified adjusted gross income (MAGI) that exceeds certain thresholds (see table to the right). Investment income includes dividends, taxable interest, annuities, capital gains, and passive income from partnerships and S corporations. MAGI, for the purposes of calculating eligibility, is your Adjusted Gross Income (AGI) plus certain adjusted foreign earned income exclusions.

Tax Filing Status

Single Married filing jointly Married filing separately Head of household Qualfying widow(er) with dependent children

MAGI

$200,000 $250,000 $125,000 $200,000 $250,000

Family Tax and Credits (continued)

Family Tax and Credits

On March 11, 2021 President Biden signed the American Rescue Plan Act of 2021 into law. The act expands the child tax credit for the 2021 tax year only. Generally the credit applies to any federal tax owed. In the event the credit exceeds the tax owed, the taxpayer generally is entitled to a refund. For tax year 2020, that refund can not exceed $1,400 per qualifying child. For tax year 2021 it is fully refundable to the extent it exceeds taxes owed.

Child Tax Credit

Qualifying child age 5 and under Qualifying child age 6 - 17 ** Other dependents Amount refundable

2021

$3,600 $3,000

$500 Fully

2020

$2,000 $2,000

$500 $1,400

**For purposes of qualifying for the tax credit in tax year 2020, a dependent is defined as under the age of 17.

Child Tax Credit Income Limit

2021*

2020

Joint

$150,000

$400,000

Head of Household

$112,500

$200,000

Single

$75,000

$200,000

*2021 Tax Credit is phased out $50 for every $1,000 over the 2021 thresholds. *Families who are not eligible for the credits passed under the new law, may still qualify for the regular credit of $2,000. See the 2020 column for those figures.

Kiddie Tax The Kiddie Tax applies to all children aged 19 and under, and also children who are dependent full-time students between the ages of 19 and 23. Under the law, all unearned income over $2,200 is taxed at the child's guardian's tax rate.

Adoption Credit

An individual may take a nonrefundable credit of up to $14,440 in 2021 ($14,300 in 2020) per child for qualified expenses related to the adoption of a child. The credit is phased out for MAGI between $216,660 $256,660 in 2021 ($214,520 - $254,520 in 2020).

Education Credits, Deductions, and Exclusions

Tax Benefit

Basic Rule

Savings Bond Income Excluded if used to pay

Exclusion

qualified higher education*

Phaseout

J: $124,800 - $154,800 O: $83,200 - $98,200

Coverdell Education Savings Accounts

Education Loan Interest Deduction

$2,000 maximum annual contribution*

Deductible up to $2,500 for interest paid on qualified education loans*

J: $190,000 - $220,000 O: $95,000 - $110,000

J: $140,000 - $170,000 O: $70,000 - $85,000

American Opportunity Credit on 100% of first

Tax Credit

$2,000 of qualified higher

education expenses plus 25%

of the next $2,000*

J: $160,000 - $180,000 O: $80,000 - $90,000

Lifetime Learning Credit

Credit on 20% of first $10,000 in qualified higher education expenses*

529 Plan (K-12)

May withdraw up to $10,000 per beneficiary per year for qualified expenses**

*Phaseout based on MAGI. **State restrictions may apply.

J: $160,000 - $180,000 O: $80,000 - $90,000

None

Other Deductions

Type of Deduction

Section 179

First-year expense election

Expense Election up to limit

2021

$1,050,000

2020

$1,040,000

Section 179 Expense Phaseout Begins

Qualified Transportation - Transit or Commuter Vehicle

Limit reduced by cost of property place in service in excess of amount

Maximum employee pretax contribution each month

$2,620,000 $270

$2,590,000 $270

Qualified

Maximum employee pretax

$270

$270

Transportation - contribution each month

Parking

Standard Mileage Rates

2021

Business Use

Deduction per mile driven 56? per mile for business use

2020

57.5? per mile

Charitable Use

Deduction per mile driven 14? per mile 14? per mile for charitable purpose

Medical Use

Deduction per mile driven 16? per mile 17? per mile for medical purpose

Moving

Deduction per mile driven 16? per mile 17? per mile on a deductible move

Health Savings Accounts

Contribution Limits

Single Family Catch-up contributions (ages 55 and older)

Minimum Annual Deductible

Single coverage Family coverage

Maximum Out-of-Pocket Expenses

Single coverage Family coverage

2021

$3,600 $7,200 $1,000

$1,400 $2,800

$7,000 $14,000

2020

$3,550 $7,100 $1,000

$1,400 $2,800

$6,900 $13,800

Estate and Gift Tax

Federal Estate and Gift Tax

Annual gift tax exclusion Annual gift tax exclusion for a noncitizen spouse Estate and lifetime gift tax basic exclusion Generation skipping exemption Applicable credit amount Top estate tax rate* *Estates exceeding $1 million

2021

$15,000

2020

$15,000

$159,000

$157,000

$11,700,000 $11,700,000 $4,625,800

40%

$11,580,000 $11,580,000 $4,577,800

40%

Social Security

Benefit Reduction

2021

2020

Under FRA*

$18,960

$18,240

Reaching FRA**

$50,520

$48,600

*Benefit reduced $1 for every $2 of earned income above limit.

**Benefit reduced $1 for every $3 of earned income above limit. This applies only in the months prior to reaching FRA. After that month is reached there is no limit.

Taxable Portion of Benefit*

Single Filers

Joint Filers

Amount Taxable

Below $25,000

Below $32,000

0%

$25,000-$34,000

$32,000-$44,000

50%

Above $34,000

Above $44,000

85%

*Determined by calculating: AGI + nontaxable interest + 1/2 of your Social Security benefits

Social Security (continued)

Retirement (continued)

FICA Taxes

Social Security Wage Base

2021

$142,800

2020

$137,700

Medicare Wage Base Tax Rate - Employee

No Limit

Social Security

6.20%

No Limit

Medicare*

1.45%

Tax Rate - Self-Employed

12.40%

2.90%

*An additional 0.9% tax is assessed if income is over $200,000 (S) and (HH), $125,000 (MFS), $250,000 (MFJ)

Full Retirement Age Attainment

Year of Birth

FRA Attained

1943-1954

66

1955

66 and 2 months

1956

66 and 4 months

1957 1958 1959 1960 and later

66 and 6 months 66 and 8 months 66 and 10 months 67

People born in 1955 are reaching FRA in the year 2021.

Social Security Cost-of-Living Adjustments (COLA)

2020

1.3%

2010

0.0%

2019

1.6%

2009

0.0%

2018

2.8%

2008

5.8%

2017

2.0%

2007

2.3%

2016

0.3%

2006

3.3%

2015

0.0%

2005

4.1%

2014

1.7%

2004

2.7%

2013

1.5%

2003

2.1%

2012

1.7%

2002

1.4%

2011

3.6%

2001

2.6%

Estimated maximum monthly benefit for a worker turning FRA (66) in 2021

$3,148

Retirement

The following are limits for the amount that can be contributed to a Traditional IRA or a Roth IRA. Your MAGI also determines your qualifications to these annual limits.

Individual Plans

IRA or Roth IRA Contribution Limit

Catch Up (age 50 and older)

2021

$6,000

$1,000

2020

$6,000

$1,000

The following are IRA deduction phaseout ranges for active participants of employer plans.

Filing Status

Single

Married filing jointly Married filing separately Non-active spouse married to an active partcipant

2021

2020

$66,000 - $76,000 $65,000 - $75,000

$105,000 - $125,000 $104,000 - $124,000

$0 - $10,000

$0 - $10,000

$198,000 - $208,000 $196,000 - $206,0000

Roth IRA Phaseout Ranges for Contributions*

2021

Single

$125,000 - $140,000

Married filing jointly

$198,000 - $208,000

Married filing separately

$0 - $10,000

2020

$124,000 - $139,000 $196,000 - $206,000

$0 - $10,000

*Based on MAGI

Employer Retirement Plans

The Internal Revenue Code (the Code) provides dollar limitations on benefits and contributions under qualified plans. The Code also limits the amount of compensation that can be taken into account when computing benefits and contributions.

Type of Plan

401(k), 403(b), 457 and SARSEPs Catch-up (age 50 and older)

Defined contribution plans limit** Defined benefit plans limit*** Highly compensated employees Annual compensation limit used to determine ceiling for most plans SIMPLE plans****

Catch-up (age 50 and older) SEP IRAs

SEP current year participation limit

2021

$19,500 $6,500 $58,000

$230,000

$130,000 $290,000

$13,500 $3,000 Up to 25% of comp, max of $58,000

$650

2020

$19,500 $6,500 $57,000

$230,000

$130,000 $285,000

$13,500 $3,000 Up to 25% of comp, max of $57,000

$600

Employer Retirement Plans (continued)

**Limit consists of the total amount of employer contributions, employee contributions, and forfeitures, are limited to the lesser of the dollar amount indicated or 100% of compensation. This limit must be coordinated with a rule applicable to profit-sharing plans, SEPs, and stock bonus plans that limit contributions to 25% of compensation. This lower limitation does not apply to employee elective contributions or forfeitures, so annual additions may exceed 25% of compensation as long as employer contributions meet the 25% limit. ***The employer can contribute up to the smaller of 25% of your compensation up to the max limit. Employer contributions and employee elective deferrals in aggregate may not exceed $58k in 2021 and $57k in 2020. Compensation limits and deductibility may apply. ****An employer can select annualy from two different contribution methods, typically either a flat 2% of pay or a match up to 3%. Employer contributions are in addition to elective deferrals.

Required Minimum Distribution

Uniform Lifetime Table (for calculating RMDs) In most cases, individuals are required to take a withdrawal from their retirement assets when you reach the age of 70 1/2. Due to changes made by the SECURE Act if your 70th birthday is July 1, 2019 or later you do not have to take withdrawals until you reach age 72. Minimum distributions rules apply to the following types of retirement plans: traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, 457(b) plans, profit sharing plans, and other defined contribution plans. For account owners whose spouses are more than 10 years younger you will use a different table than stated below. See for more information.

To Calculate RMDs, use the following formula for each account (please speak with a tax advisor to confirm):

1 Take your account balance as of

December 31 last year

2 Divide that figure by

3 Your Life Expectancy Divisor number

(use the table) that corresponds with your age that you will turn in 2021

4 The resulting number is Your RMD

Required Minimum Distribution (continued)

Life Expectancy Table

Age of IRA owner or plan partcipant 70 71 72 73

Life Expectancy

Divisor 27.4 26.5 25.6 24.7

74

23.8

75

22.9

76

22

77

21.2

78

20.3

79

19.5

80

18.7

81

17.9

82

17.1

83

16.3

84

15.5

85

14.8

86

14.1

Age of IRA owner or plan partcipant

87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103

Life Expectancy Divisor

13.4 12.7 12 11.4 10.8 10.2 9.6 9.1 8.6 8.1 7.6 7.1 6.7 6.3 5.9 5.5 5.2

Long-Term Care

Qualified Long-Term Care Insurance Premiums Premiums paid for qualified long-term care insurance are deductible as a medical expense, subject to AGI limitations based on the insured's age listed in the table below.

Attained Age Before Close of Tax Year

Age 40 and younger Ages 41 - 50 Ages 51 - 60

Ages 61 - 70 Age 71 and older

2021

$450 $850 $1,690 $4,520 $5,640

2020

$430 $810 $1,630 $4,350 $5,430

Medicare

2021 Medicare Part B Premiums and Part D Surcharge

If your 2019 income was:

MAGI Single

MAGI Married Filing Jointly

$88,000 or less

$176,000 or less

$88,000 or less

$176,000 or less

$88,001 - $111,000 $176,001 - $222,000

$111,001 - $138,000 $222,001 - $276,000

Part B Part D Premium Surcharge $115.48* $0.00 $148.50** $0.00 $207.90 $12.30

$297.00 $31.80

$138,001 - $165,000 $276,001 - $330,000 $165,001 - $500,000 $330,001 - $750,000

$386.10 $475.20

$51.20 $70.70

Above $500,000 *Hold Harmless

Above $750,000 **Not Hold Harmless

$504.90 $77.10

If you file MFS and your 2019 income was:

Part B Premium

Part D Surcharge

$88,0000 or less

$148.50

$0.00

$88,001 - $412,000

$475.20

$70.70

Above $412,000

$504.90

$77.10

Deductibles and Coinsurance

Part A (inpatient) deductible - First 60 days Part A - Days 61 - 90 Part A - More than 90 days of hospitalization Part B - Deductible

Part B - Coinsurance Part D - Deductible

$1,484 $371/day - coinsurance $742/day - coinsurance

$203 20% $445

?2021 Oppenheimer & Co. Inc. Transacts Business on All Principal Exchanges and Member SIPC. All Rights Reserved.

The information contained herein is general in nature, has been obtained from various sources believed to be reliable and is subject to changes in the Internal Revenue Code, as well as other areas of law. Neither Oppenheimer & Co. Inc. ("Oppenheimer") nor any of its employees or affiliates provides legal or tax advice. Please contact your legal or tax advisor for specific advice regarding your circumstances. 3725918.1

No part of this brochure may be reproduced in any manner without the written permission of Oppenheimer & Co. Inc.

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