Bloomberg BNA Releases Comprehensive 2018 Projected Inflation-Adjusted Tax Figures


For a sixth year, Bloomberg BNA has released extensive, projected inflation-adjusted amounts for tax brackets, penalties, thresholds, limits, and deductions in the tax code using data from the Consumer Price Index, including the medical care component, released September 14. Bloomberg BNA has compiled and projected an extensive list of inflation adjustments, which the IRS publishes in an annual revenue procedure and notice later in the fall. The full report, containing over 320 inflation-adjusted amounts, is available at https://go.bloombergbna.com/2018-PTR/.  

The 2018 projected inflation adjustments, generally made using a derivative of the formula in §1(f)(3) of the Code, are intended to give tax preparers and advisers the opportunity to initiate tax preparation and planning as soon as possible.   

For example, Bloomberg BNA’s projections include the following items: 

  • §125 limitation on health flexible spending arrangements
  • §408A Roth IRA adjusted gross income limitations
  • §7345 passport revocation threshold for seriously delinquent tax debts
  • §9831 maximum payments and reimbursements for qualified small employer health insurance arrangements  

Individual Income Tax Brackets  

Bloomberg BNA has projected the income tax rate tables for individuals. For 2018, the tables are:  

Married Filing Jointly and Surviving Spouses

 

If Taxable Income Is: The Tax Is:
Not Over $19,050 10% of the taxable income
Over $19,050 but not over $77,400 $1,905 plus 15% of excess over $19,050
Over $77,400 but not over $156,150 $10,657.50 plus 25% of excess over $77,400
Over $156,150 but not over $237,950 $30,345 plus 28% of excess over $156,150
Over $237,950 but not over $424,950 $53,249 plus 33% of excess over $237,950
Over $424,950 but not over $480,050 $114,959 plus 35% of excess over $424,950
Over $480,050 $134,244 plus 39.6% of excess over $480,050

 

Heads of Households

 

If Taxable Income Is: The Tax Is:
Not Over $13,600 10% of the taxable income
Over $13,600 but not over $51,850 $1,360 plus 15% of excess over $13,600
Over $51,850 but not over $133,850 $7,097.50 plus 25% of excess over $51,850
Over $133,850 but not over $216,700 $27,597.50 plus 28% of excess over $133,850
Over $216,700 but not over $424,950 $50,795.50 plus 33% of excess over $216,700
Over $424,950 but not over $453,350 $119,518 plus 35% of excess over $424,950
Over $453,350 $129,458 plus 39.6% of excess over $453,350

 

Unmarried Individuals (other than Surviving Spouses and Heads of Households)

 

If Taxable Income Is: The Tax Is:
Not Over $9,525 10% of the taxable income
Over $9,525 but not over $38,700 $952.50 plus 15% of excess over $9,525
Over $38,700 but not over $93,700 $5,328.75 plus 25% of excess over $38,700
Over $93,700 but not over $195,450 $19,078.75 plus 28% of excess over $93,700
Over $195,450 but not over $424,950 $47,568.75 plus 33% of excess over $195,450
Over $424,950 but not over $426,700 $123,303.75 plus 35% of excess over $424,950
Over $426,700 $123,916.25 plus 39.6% of excess over $426,700

 

Married Filing Separately

 

If Taxable Income Is: The Tax Is:
Not Over $9,525 10% of the taxable income
Over $9,525 but not over $38,700 $952.50 plus 15% of excess over $9,525
Over $38,700 but not over $78,075 $5,328.75 plus 25% of excess over $38,700
Over $78,075 but not over $118,975 $15,172.50 plus 28% of excess over $78,075
Over $118,975 but not over $212,475 $26,624.50 plus 33% of excess over $118,975
Over $212,475 but not over $240,025 $57,479.50 plus 35% of excess over $212,475
Over $240,025 $67,122 plus 39.6% of excess over $240,025

 

Estate and Gift Tax Exclusions  

Also included in the Bloomberg BNA projections are the estate and gift tax exclusions. For 2018, the estate tax exclusion is expected to increase to $5.6 million. For the first time since 2013 the gift tax exclusion is expected to increase. The gift tax exclusion is expected to increase from $14,000 to $15,000.   

Affordable Care Act Amounts

Additionally, Bloomberg BNA’s projections also take into account items that are adjusted for inflation that relate to the Affordable Care Act (Pub. L. No. 111-148), such as the §4980H employer responsibility excise tax. For 2018, the amounts used to calculate the employer responsibility excise tax are:

  • $2,320 for large employers not offering health coverage; or
  • $3,480 for large employers offering coverage with employees who qualify for premium tax credits or cost-sharing reductions.

The full Bloomberg BNA projected inflation adjustments are available at https://go.bloombergbna.com/2018-PTR/.