Handy Tax Guide

Helpful Info for This Year’s Taxes

Tackle this year’s taxes with our 2024 Handy Tax Guide, prepared by the CPAs of Dugan + Lopatka. This quick, simple reference has helpful info on current tax rates, deductions, depreciation limits, and more.

For additional guidance, contact our Chicagoland CPAs today.

This guide reflects tax laws in effect as of 1/1/24.

  • Individual Income Tax Rates

    Married Taxpayers Filing Jointly or Surviving Spouses
    Taxable Income OverBut Not OverIs Taxed At
    Single Taxpayers
    Taxable Income OverBut Not OverIs Taxed At
    Heads of Households
    Taxable Income OverBut Not OverIs Taxed At
    Estates & Trusts
    Taxable Income OverBut Not OverIs Taxed At
    Alternative Minimum Tax
    Tax Rate on AMTI26% up to$232,600
    28% over$232,600
    Exemption AmountPhase-Out Threshold
    Married Filing Jointly$133,300$1,218,700
    Married Filing Separately$66,650$609,350
    All Individual Tax Payers$85,700$609,350
  • Deductions & Exemptions

    Standard Deduction*Elderly or Blind**
    Married Filing Jointly$29,200$1,550
    Head of Household$21,900$1,950
    Married Filing Separately$14,600$1,550
    Dependent of Another$1,300

    *You are allowed to deduct the greater of your standard deduction or your itemized deductions.

    Personal Exemptions - Repealed Deduction Limitations

    Section 199A Qualified Business Income Deduction: 20% of domestic qualified business income (multiple limitations apply).

    Medical & Dental Expenses: Excess over 7.5% AGI.

    State & Local Taxes: $10,000 maximum deduction.

    Mortgage Interest Deduction: Limited to $750,000 of principal for post 12/15/17 acquisition indebtedness.

    Deductions Repealed (as of Jan 1, 2018)
    • Miscellaneous itemized deductions
    • Interest on home equity indebtedness
    • Moving expenses

    Tax credits of $2,000 per child and $500 per non-child dependent begin to phase out for taxpayers with modified adjusted gross income exceeding $400,000 for joint and $200,000 for single filers.

  • Estimated Tax Payments

    To avoid possible underpayment penalties, you are generally required to pay in through withholding or estimated tax payments the lesser of:

    1. One hundred percent of prior-year tax liability, (110% if AGI >$150,000) or,
    2. Ninety percent of current-year tax liability.
    2024 Estimated Tax Payments for Individuals are due by:
    • April 15, 2024
    • June 17, 2024
    • September 16, 2024
    • January 15, 2025
  • Net Investment Income Medicare Surtax

    The net investment income surtax on individuals equals 3.8% of the lesser of:

    • Net investment income*, or
    • The excess, if any, of
    • The individual’s modified adjusted gross income, over the threshold amount.
    Filing StatusThreshold Amount
    Married Filing Jointly$250,000
    Married Filing Separately$125,000
    Single, Head of Household$200,000

    *Common types of “net investment income” include interest, dividends, annuities, royalties, rents, net capital gain on investments, passive activities.

  • Capital Gain & Qualified Dividend Tax Rates for Noncorporate Taxpayers

    Single TaxpayerMarried Filing JointlyCapital Gain Tax Rate*Net Investment Income Medicare Surtax**Combined Tax Rate

    * Short-term capital gains (held less than 12 months) are taxed at the same rate as ordinary income, gains on collectibles (including metals) are taxed at 28%, recapture gains on real estate are taxed at 25%.

    ** The 3.8% Net Investment Income Medicare surtax only applies to “net investment income” as defined in IRC 1411.

  • Estate Tax Rates

    The estate tax and gift tax exemption for 2024 is $13.61 million. The estate and gift tax rate on amounts in excess of $13.61 million is 40%. The estate tax exemption is portable between spouses resulting in a $27.22 million exemption per couple regardless of ownership of assets.

    Annual Gift Tax Exclusion

    Gifts per person, $18,000

    Joint gifts by spouses, $36,000

  • Business Provisions

    • Corporate income taxed at a flat rate of 21%.
    • Federal Net Operating Loss deduction limited to 80% of taxable income.
    • Illinois Net Operating Loss deduction limited to $100,000.
  • Employment Tax Rates

    EmployerTax RateWage Base
    Social Security6.20%$168,600
    Medicare+1.45%No Limit
    EmployeeTax RateWage Base
    Social Security6.20%$168,600
    Medicare+1.45%No Limit
    Self EmployedTax RateWage Base
    Social Security12.40%$168,600
    Medicare+2.90%No Limit

    *Additional 0.9% Medicare tax is imposed on individuals who receive wages or self-employment income in excess of $200,000 ($250,000 for joint return, $125,000 for married filing separate).

  • Depreciation/Amortization

    • 3 – Year Assets (200% DB) Dies, molds, small tools
    • 3 – Year Assets (Straight-line) Computer software (if separately stated from hardware)
    • 5 – Year Assets (200% DB) Autos, light-/heavy-duty trucks, computers, typewriters, copiers, medical equipment, construction equipment, wholesale/retail equipment, private aircraft, some manufacturing equipment
    • 7 – Year Assets (200% DB) Most manufacturing equipment, office furniture, printing equipment
    • 15 – Year Assets (Straight-line) Intangible assets including goodwill, going concern value and covenants not to compete. Qualified improvement property
    • 27.5 – Year Assets (Straight-line) Rental houses, apartments, low-income housing
    • 39 – Year Assets (Straight-line) Commercial and industrial buildings, office buildings, shopping centers, warehouses, manufacturing facilities
    Annual Recovery

    Percent of Original Depreciable Basis Under 200% DB Method

    Recovery Year12345678
    3 Year33.3344.4514.817.41
    5 Year20.0032.0019.2011.5211.525.76
    7 Year14.2924.4917.4912.498.938.928.934.46
    Section 179 Expense Deduction

    Small Business taxpayers may elect to expense $1.22 million of certain new or used qualifying depreciable property placed in service in tax year 2024. Deduction is phased-out if the cost of qualifying property placed in service during the year exceeds $3.05 million.

    Special (Bonus) Depreciation Allowance

    Bonus depreciation allowance can be claimed for qualified property placed in service:

    • 80% for 2023
    • 60% for 2024
    • 40% for 2025
    • 20% for 2026
    2023 Standard Mileage Deductions
    • Business, $0.67 per mile
    • Charitable, $0.14 per mile
    • Medical or moving purposes for qualified active duty members of the Armed Forces, $0.21 per mile
  • Retirement Plan Limits

    Individual Limitations
    Under Age 50Age 50 & Up
    IRA$7,000 (a)$8,000 (a)
    Roth IRA$7,000 (b)$8,000 (b)
    401(k)/SARSEP Salary Deferrals$23,000$30,500
    Simple Plans$16,000$19,500

    Profit Sharing Plans
    • Corporate, 100% up to $69,000 (c)
    • SEP – self-employed, 20% up to $69,000 (d)
    • SEP – employee, 25% up to $69,000

    (a) Phaseout for deducting IRA contributions (qualified plan participants):

    • Joint: $123,000 – $143,000 AGI
    • Single or HOH: $77,000 – $87,000 AGI

    (b) Phaseout of Roth contribution eligibility:

    • Joint: $230,000 – $240,000 AGI
    • Single or HOH: $146,000 – $161,000 AGI

    (c) Overall plan is limited to 25% of total compensation of all eligible employees (capped at $345k per employee).

    (d) Of net self-employed income after 1/2 self-employment tax deduction (capped at $345k per employee).

  • Social Security Benefits

    Maximum earned income limit:

    Ages 62-65 years$22,320$1,860
    Months before individual reaches age 66$59,520$4,960
    Months after age 66No LimitNo Limit
  • Taxable Social Security

    Social Security received is taxable if AGI, plus tax-exempt interest, plus one-half of Social Security received, exceeds these base amounts:

    The taxable amount is the lesser of:
    a. Percent of the excess over the base amount, or
    b. 85% of benefit received

    Base Amount For50% Over Base85% Over Base
    Married Filing Jointly$32,001-$44,000$44,001+
    Single/Head of Household$25,001-$34,000$34,001+
    Married Filing Separately$0$0

For additional guidance, contact D+L

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