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Tax Changes for 2019-2020: What You Need to Know

Here's how some of the most influential tax rules have changed for 2019-2020 and how they might affect you.
Jan. 29, 2020
Income Taxes, Personal Taxes, Taxes
Never Mind Tax Reform — What's Different When I File This Year?
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Each year, the IRS does some tinkering and adjusting to various tax rules, and knowing what they are could save you a lot of money. Here’s what’s different for the 2019 tax year, which will affect the tax return you’ll file in 2020.

Tax brackets and tax rates

There are seven federal tax brackets for the 2019 tax year: 10%, 12%, 22%, 24%, 32%, 35% and 37%. Your bracket depends on your taxable income and filing status. These are the rates for taxes due in April 2020.

2019 federal income tax brackets

(for taxes due in April 2020, or in October 2020 with an extension)

Tax rateSingleMarried, filing jointlyMarried, filing separatelyHead of household
10%$0 to $9,700$0 to $19,400$0 to $9,700$0 to $13,850
12%$9,701 to $39,475$19,401 to $78,950$9,701 to $39,475$13,851 to $52,850
22%$39,476 to $84,200$78,951 to $168,400$39,476 to $84,200$52,851 to $84,200
24%$84,201 to $160,725$168,401 to $321,450$84,201 to $160,725$84,201 to $160,700
32%$160,726 to $204,100$321,451 to $408,200$160,726 to $204,100$160,701 to $204,100
35%$204,101 to $510,300$408,201 to $612,350$204,101 to $306,175$204,101 to $510,300
37%$510,301 or more$612,351 or more$306,176 or more$510,301 or more
Expand the filing status that applies to you.

Tax rateTaxable income bracketTax owed
10%$0 to $9,70010% of taxable income
12%$9,701 to $39,475$970 plus 12% of the amount over $9,700
22%$39,476 to $84,200$4,543 plus 22% of the amount over $39,475
24%$84,201 to $160,725$14,382.50 plus 24% of the amount over $84,200
32%$160,726 to $204,100$32,748.50 plus 32% of the amount over $160,725
35%$204,101 to $510,300$46,628.50 plus 35% of the amount over $204,100
37%$510,301 or more$153,798.50 plus 37% of the amount over $510,300
Tax rateTaxable income bracketTax owed
10%$0 to $19,40010% of taxable income
12%$19,401 to $78,950$1,940 plus 12% of the amount over $19,400
22%$78,951 to $168,400$9,086 plus 22% of the amount over $78,950
24%$168,401 to $321,450$28,765 plus 24% of the amount over $168,400
32%$321,451 to $408,200$65,497 plus 32% of the amount over $321,450
35%$408,201 to $612,350$93,257 plus 35% of the amount over $408,200
37%$612,351 or more$164,709.50 plus 37% of the amount over $612,350
Tax rateTaxable income bracketTax owed
10%$0 to $9,70010% of taxable income
12%$9,701 to $39,475$970 plus 12% of the amount over $9,700
22%$39,476 to $84,200$4,543 plus 22% of the amount over $39,475
24%$84,201 to $160,725$14,382.50 plus 24% of the amount over $84,200
32%$160,726 to $204,100$32,748.50 plus 32% of the amount over $160,725
35%$204,101 to $306,175$46,628.50 plus 35% of the amount over $204,100
37%$306,176 or more$82,354.75 plus 37% of the amount over $306,175
Tax rateTaxable income bracketTax owed
10%$0 to $13,85010% of taxable income
12%$13,851 to $52,850$1,385 plus 12% of the amount over $13,850
22%$52,851 to $84,200$6,065 plus 22% of the amount over $52,850
24%$84,201 to $160,700$12,962 plus 24% of the amount over $84,200
32%$160,701 to $204,100$31,322 plus 32% of the amount over $160,700
35%$204,101 to $510,300$45,210 plus 35% of the amount over $204,100
37%$510,301 or more$152,380 plus 37% of the amount over $510,300

Standard deduction

The standard deduction reduces your taxable income. In 2019 the standard deduction is $12,200 for single filers and married filers filing separately, $24,400 for married filers filing jointly and $18,350 for heads of household. (Go here for help deciding whether to itemize or take the standard deduction.)

Filing status2019 tax year2020 tax year
Single$12,200$12,400
Married, filing jointly$24,400$24,800
Married, filing separately$12,200$12,400
Head of household$18,350$18,650

The standard deduction is $1,300 higher for those who are over 65 or blind; it’s $1,650 higher if also unmarried and not a surviving spouse.

Personal exemption

There are no personal exemptions in the 2019 tax year.

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Retirement plan contribution and income limits

Contributing to an IRA can cut your tax bill significantly.

Traditional IRA income limits in 2019 and 2020

Note: Traditional IRA income limits apply only if you (or your spouse) have a retirement account at work.

Filing status2019 MAGI2020 MAGIDeduction
Single or head of household$64,000 or less$65,000 or lessFull deduction
More than $64,000 but less than $74,000More than $65,000 but less than $75,000Partial deduction
$74,000 or more$75,000 or moreNo deduction
Married filing jointly$103,000 or less$104,000 or lessFull deduction
More than $103,000 but less than $123,000More than $104,000 but less than $124,000Partial deduction
$123,000 or more$124,000 or moreNo deduction
Married filing jointly (spouse covered by retirement plan at work)$193,000 or less$196,000 or lessFull deduction
More than $193,000 but less than $203,000More than $196,000 but less than $206,000Partial deduction
$203,000 or more$206,000 or moreNo deduction
Married filing separately (you or spouse covered by retirement plan at work)Less than $10,000Less than $10,000Partial deduction
$10,000 or more$10,000 or moreNo deduction

Roth IRA income limits in 2019 and 2020

Filing status2019 MAGI2020 MAGIMaximum annual contribution
Single, head of household or married filing separately (if you didn't live with spouse during year)Less than $122,000Less than $124,000$6,000 ($7,000 if 50 or older)
$122,000 up to $137,000$124,000 up to $139,000Contribution is reduced
$137,000 or more$139,000 or moreNo contribution allowed
Married filing jointly or qualifying widow(er)Less than $193,000Less than $196,000$6,000 ($7,000 if 50 or older)
$193,000 up to $203,000$196,000 up to $206,000Contribution is reduced
$203,000 or more$206,000 or moreNo contribution allowed
Married filing separately (if you lived with spouse at any time during year)Less than $10,000Less than $10,000Contribution is reduced
$10,000 or more$10,000 or moreNo contribution allowed

Student loan interest deduction

The student loan interest deduction lets you deduct up to $2,500 from your taxable income if you paid interest on student loans in 2019. If you fall into the 22% tax bracket, for example, the maximum student loan interest deduction would put $550 back in your pocket.

Student loan interest is deductible if your modified adjusted gross income, or MAGI, was less than $70,000 in the past tax year. The maximum deduction is $2,500. If your MAGI was between $70,000 and $85,000, you can deduct a reduced amount of interest that you paid.

Earned Income Tax Credit

The Earned Income Tax Credit (EIC or EITC) is a refundable tax credit for low- and moderate-income workers. The amount depends on income and number of children. People without kids can qualify. For the 2019 tax year, the earned income credit ranges from $529 to $6,557. For 2020, it’s $538 to $6,660 (go here for more on how it works).

2019 Earned Income Tax Credit

(for taxes due in April 2020)
Number of childrenMaximum earned income tax creditMax earnings,
single or head of household filers
Max earnings,
joint filers
0$529$15,570$21,370
1$3,526$41,094$46,884
2$5,828$46,703$52,493
3 or more$6,557$50,162$55,952
  • Both your earned income and your adjusted gross income each have to be below the levels in the table.
  • In general, the less you earn, the larger the earned income credit.
  • Your earned income usually includes job wages, salary, tips and other taxable pay you get from your employer. Your adjusted gross income is your earned income minus certain deductions.

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