B.E.S.T. 2016 Tax Update
Better Economic Solutions Team is proud to
provide you with the B.E.S.T. Tax Update.
We believe knowledge can empower you. We are
dedicated to providing you information so you can
make confident decisions.
New laws will determine
how much you pay for healthcare.
This was true in previous years, however, the
Affordable Care Act (ACA) will allow the Internal
Revenue Service to use your tax return to determine
how much you pay for health insurance premiums.
Ultimately the ACA will determine where and how you
receive healthcare as doctors and hospitals, such as
Stony Brook Hospital, decide whether they will accept
ACA healthcare plans. This is an historic time in
American history. The idea that your tax will return
will impact your healthcare would have made our
founding fathers winze but this is progress, or so they
Understanding your tax return
Can help you save money.
Saving money is important today especially for Middle
Class American Leftovers, people who cannot receive
subsidies or financial assistance because their
income may be slightly too high causing them to pay
more for healthcare expenses and financial aide for
students. Your tax return is a tool that can determine
how much you pay for healthcare or college much like
your credit report determines how much interest you
pay on a loan. Sometimes a simple tax deduction can
help you save money.
Planning ahead can determine
how much you deduct for healthcare.
Bunching tax deductions can help you save tax
dollars. If you know, for example, that you need a lot
of dental work you may want to pay the expense all in
one year. This may increase your tax deduction as the
ACA has made it more difficult for many to claim
medical deductions (medical deductions must now
exceed 10% of your Adjusted Gross Income).
The difference between death and taxes is death
doesn't get worse every time Congress meets.
Thank You For Your Trust!
Education is your B.E.S.T. defense against making
costly mistakes when planning your future.
Tax Planning Considers:
Current Cash Flow– Your cash flow is either reduced
or increased by the amount of income taxes you pay
each year. ♦
College Financial Aide– Parents sending children to
college may find tax planning is helpful when applying
for financial aide. ♦
Medicare—Premiums for Medicare Part B (doctors
and labs) and Part D (prescription drug coverage) are
based on your tax return and are increased for people
with higher income. ♦
Medicaid and Long Term Care– Paying for home
care, assisted living or nursing home care is
costly. Your tax return can determine how much you
pay for health services and how much of your assets
may be preserved. ♦
Real Estate Star Programs– Owning a home on
Long Island is costly so saving money on real estate
taxes is essential. ♦
Retirement Income– How much of your Social
Security is taxable is based on other income your re-
Estate Taxes– Taxing assets twice may not be
uncommon. For example, IRA’s may be taxed to your
estate and then again to the beneficiary. Avoid double
taxation if you can. ♦
Let the B.E.S.T. team help you with your tax
planning. Saving you money is our top priority!
Affording healthcare, Preserving assets
and Paying less taxes...
The B.E.S.T. APP to help you plan your future.
Our Certified Financial Planners ™
Have the B.E.S.T. team for you!
2015 Exemption $4,000.
Standard deduction Single $6,300
Head House $9,250
You can deduct an extra standard deduction of $1,200 if over age 65
or blind Married Filing Joint or $1,550 for single.
IRA Rollovers can now only happen once annually with in 60 days
Mileage Standard Rates
Work related unreimbursed mileage is 57.5 cents per mile
Medical miles is .23 cents
Charity miles is .14 cents
Don’t forget job search mileage and expenses. Also verify if you paid
personal AUTO state registration fees in 2015.
Alternative Minimum Tax (AMT) Exemption
Phase out certain deduc ons if your income is over
Single $53,600 MFJ $83,400 MFS $41,700
Job Related Deductions
Make sure you can prove your deductions. The Internal Revenue Service
is seriously doing more audits to close the Tax Gap.
Social Security taxable wages up to $118,500
Education Deduction and Credit
Life me Credit is $2,000 per return ($10,000 in life me)
American Opportunity Credit is $2,500 per student (4 years only)
Long Term Care Deduc ons
Maximum deduc ons $4,750 for over age 70
And don’t forget the NYS 20% tax credit
Affordable Care Act Tax Form Updates
If you have heath insurance you should receive one of the new
tax 1095 forms. If you do not have one of these forms, YOUR
REFUND MAY BE REDUCED ‐ you may have to pay a Penalty for
2015 its 2% of HOUSEHOLD income or $325 (Max is $975).
The penalty rises in...
2016, its the greater of 2.5% of HOUSEHOLD annual income or
$695 (Max per family $2,085).
Credits are based on income and will be determined by the Health
Exchange. If you received too much of a credit, your refund will be
The marginal Federal Tax Brackets are 10%, 15%, 25%, 28%, 33%, 35%, 39.60%.
The tax rate for net long‐term capital gains is 20% for taxpayers subject to the
39.60% marginal tax on ordinary income.
The 15% capital gains rate continues to apply to taxpayers subject to the 25% to
35% marginal tax on ordinary income.
The 0% capital gains rate continues to apply to taxpayers subject to the 15% to
10% marginal tax on ordinary income.
Medicare tax increase
On unearned income such as dividends, interest, capital gains and rental income
the increased Medicare tax rate of 3.8% applies to income over $200,000
(singles) $250,000 (MFJ). Additionally, taxpayers will pay an extra Medicare
withholding tax of 1.45%.
W-2 Wage statements W-2 G Gambling
1099 R Pensions 1099 Int/Div Interest & Dividends
1099 SA Social Security 1099 Misc Subcontractor / other
1099 C Debt Cancellation 1098 T Tuition College
1099 G Unemployment \Other
New HEALTHCARE TAX 1095 Forms
1095 A Insurance Exchange Subsidy
1095 B Insurance Company Health Care
1095 C Large Employer Health Insurance
Capital Gains / Losses
1099 B Form > List all stocks sold and purchase information
Adjustments to Income
CD early withdrawal penalty Tuition Student Loan Interest
Alimony paid or received 529 Contributions or Withdrawals
IRA/SEP Contributions HSA Contributions or Withdrawals
Medical Expenses (Limitations Apply) Real Estate Taxes Paid
Auto registration, including renewals Charity, including mileage
Mortgage Interest Investment Advisory fees
Unreimbursed Job Expenses including:
Mileage, phone, computer and on-line expenses, dues, job search and educational costs
Other, List Income or Expenses Separately For:
Self Employed Income & Expenses Rental Property Income & Expenses
Moving Expenses Child Care expenses
Jury Duty Children’s income for kiddie tax rules
Taxes grow without rain ~ Jewish Proverb
Find out when you are getting your refund,
Log onto IRS.gov
Your Quick Tax Organizer Reference ...
Cross it off as you get it. Being prepared gets faster refunds
Pension Contribution Limits for 2015 and 2016
401K/457/403b’s $18,000 (catch up for over age 50 is $6,000)
IRA/Roth’s $5,500 (catch up for over age 50 is $1,000)
Annual Gift Exclusion $14,000
Health Savings Account contributions 2015 & 2016 is $3,350 if single and
Family contributions maximums for 2015 is $6,650 and 2016 is $6,750
Pension Contribution Limits
401K $18,000 (catch up for over age 50 is $6,000)
IRA’s $5,500 (catch up for over age 50 is $1,000)
Public Safety Officers (police and Fire Fighters)
They may exclude up to $3,000 from IRA or retirement accounts if they are
used for healthcare, including Long Term Care premiums. Volunteer fire
fighters may also get a New York State credit of $200.
The amount of assets an individual can leave to their heirs without
paying taxes a er 2013 is $5.43 million. The top tax rate is 40%.
2015 Earned Income to be eligible for the Earned Income Credit (EIC)
Earned Income and adjusted gross income (AGI) must each be less than:
$47,955 ($53,505 married filing jointly) with three or more qualifying children
$44,648 ($50,198 married filing jointly) with two