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IRS Updates Inflation-Adjusted Tables For 2011

DEC. 23, 2010

Rev. Proc. 2011-12; 2011-2 I.R.B. 297

DATED DEC. 23, 2010
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Citations: Rev. Proc. 2011-12; 2011-2 I.R.B. 297

Part III

Administrative, Procedural, and Miscellaneous

26 CFR 601.602: Tax forms and instructions.

(Also Part I, §§ 1, 24, 25A, 32, 63, 132, 151, 221)

                           Table of Contents

 

 

 SECTION 1. PURPOSE

 

 SECTION 2. 2011 ADJUSTED ITEMS

 

 

                                                        Code Section

 

 .01 Tax Rate Tables                                    1(a)-(e)

 

 .02 Child Tax Credit                                   24

 

 .03 Hope Scholarship and Lifetime Learning Credits     5A

 

 .04 Earned Income Credit                               32

 

 .05 Standard Deduction                                 63

 

 .06 Qualified Transportation Fringe                    132(f)

 

 .07 Personal Exemption                                 151

 

 .08 Interest on Education Loans                        221

 

 

 SECTION 3. EFFECTIVE DATE

 

 

 SECTION 4. DRAFTING INFORMATION

 

 

SECTION 1. PURPOSE

This revenue procedure sets forth inflation adjusted items for 2011. Other inflation adjusted items for 2011 are in Rev. Proc. 2010-40, 2010-46 I.R.B. 663 (dated November 15, 2010).

SECTION 2. 2011 ADJUSTED ITEMS

.01 Tax Rate Tables. For taxable years beginning in 2011, the tax rate tables under § 1 are as follows:

      TABLE 1 -- Section 1(a) -- Married Individuals Filing Joint

 

                     Returns and Surviving Spouses

 

 _____________________________________________________________________

 

 

 If Taxable Income Is:              The Tax Is:

 

 _____________________________________________________________________

 

 

 Not over $17,000                   10% of the taxable income

 

 

 Over $17,000 but                   $1,700 plus 15% of

 

 not over $69,000                   the excess over $17,000

 

 

 Over $69,000 but                   $9,500 plus 25% of

 

 not over $139,350                  the excess over $69,000

 

 

 Over $139,350 but                  $27,087.50 plus 28% of

 

 not over $212,300                  the excess over $139,350

 

 

 Over $212,300 but                  $47,513.50 plus 33% of

 

 not over $379,150                  the excess over $212,300

 

 

 Over $379,150                      $102,574 plus 35% of

 

                                    the excess over $379,150

 

 

            TABLE 2 -- Section 1(b) -- Heads of Households

 

 _____________________________________________________________________

 

 

 If Taxable Income Is:              The Tax Is:

 

 _____________________________________________________________________

 

 

 Not over $12,150                   10% of the taxable income

 

 

 Over $12,150 but                   $1,215 plus 15% of

 

 not over $46,250                   the excess over $12,150

 

 

 Over $46,250 but                   $6,330 plus 25% of

 

 not over $119,400                  the excess over $46,250

 

 

 Over $119,400 but                  $24,617.50 plus 28% of

 

 not over $193,350                  the excess over $119,400

 

 

 Over $193,350 but                  $45,323.50 plus 33% of

 

 not over $379,150                  the excess over $193,350

 

 

 Over $379,150                      $106,637.50 plus 35% of

 

                                    the excess over $379,150

 

 

        TABLE 3 -- Section 1(c) -- Unmarried Individuals (other

 

            than Surviving Spouses and Heads of Households)

 

 _____________________________________________________________________

 

 

 If Taxable Income Is:              The Tax Is:

 

 _____________________________________________________________________

 

 

 Not over $8,500                    10% of the taxable income

 

 

 Over $8,500 but                    $850 plus 15% of

 

 not over $34,500                   the excess over $8,500

 

 

 Over $34,500 but                   $4,750 plus 25% of

 

 not over $83,600                   the excess over $34,500

 

 

 Over $83,600 but                   $17,025 plus 28% of

 

 not over $174,400                  the excess over $83,600

 

 

 Over $174,400 but                  $42,449 plus 33% of

 

 not over $379,150                  the excess over $174,400

 

 

 Over $379,150                      $110,016.50 plus 35% of

 

                                    the excess over $379,150

 

 

            TABLE 4 -- Section 1(d) -- Married Individuals

 

                        Filing Separate Returns

 

 _____________________________________________________________________

 

 

 If Taxable Income Is:              The Tax Is:

 

 _____________________________________________________________________

 

 

 Not over $8,500                    10% of the taxable income

 

 

 Over $8,500 but                    $850 plus 15% of

 

 not over $34,500                   the excess over $8,500

 

 

 Over $34,500 but                   $4,750 plus 25% of

 

 not over $69,675                   the excess over $34,500

 

 

 Over $69,675 but                   $13,543.75 plus 28% of

 

 not over $106,150                  the excess over $69,675

 

 

 Over $106,150 but                  $23,756.75 plus 33% of

 

 not over $189,575                  the excess over $106,150

 

 

 Over $189,575                      $51,287 plus 35% of

 

                                    the excess over $189,575

 

 

             TABLE 5 -- Section 1(e) -- Estates and Trusts

 

 _____________________________________________________________________

 

 

 If Taxable Income Is:              The Tax Is:

 

 _____________________________________________________________________

 

 

 Not over $2,300                    15% of the taxable income

 

 

 Over $2,300 but                    $345 plus 25% of

 

 not over $5,450                    the excess over $2,300

 

 

 Over $5,450 but                    $1,132.50 plus 28% of

 

 not over $8,300                    the excess over $5,450

 

 

 Over $8,300 but                    $1,930.50 plus 33% of

 

 not over $11,350                   the excess over $8,300

 

 

 Over $11,350                       $2,937 plus 35% of

 

                                    the excess over $11,350

 

 

.02 Child Tax Credit. For taxable years beginning in 2011, the value used in § 24(d)(1)(B)(i) to determine the amount of credit under § 24 that may be refundable is $3,000.

.03 Hope Scholarship, American Opportunity, and Lifetime Learning Credits.

(1) For taxable years beginning in 2011, the Hope Scholarship Credit under § 25A(b)(1), as increased under § 25A(i) (the American Opportunity Tax Credit), is an amount equal to 100 percent of qualified tuition and related expenses not in excess of $2,000 plus 25 percent of those expenses in excess of $2,000, but not in excess of $4,000. Accordingly, the maximum Hope Scholarship Credit allowable under § 25A(b)(1) for taxable years beginning in 2011 is $2,500.

(2) For taxable years beginning in 2011, a taxpayer's modified adjusted gross income in excess of $80,000 ($160,000 for a joint return) is used to determine the reduction under § 25A(d)(2) in the amount of the Hope Scholarship Credit otherwise allowable under § 25A(a)(1). For taxable years beginning in 2011, a taxpayer's modified adjusted gross income in excess of $51,000 ($102,000 for a joint return) is used to determine the reduction under § 25A(d)(2) in the amount of the Lifetime Learning Credit otherwise allowable under § 25A(a)(2).

.04 Earned Income Credit.

(1) In general. For taxable years beginning in 2011, the following amounts are used to determine the earned income credit under § 32(b). The "earned income amount" is the amount of earned income at or above which the maximum amount of the earned income credit is allowed. The "threshold phaseout amount" is the amount of adjusted gross income (or, if greater, earned income) above which the maximum amount of the credit begins to phase out. The "completed phaseout amount" is the amount of adjusted gross income (or, if greater, earned income) at or above which no credit is allowed. The threshold phaseout amounts and the completed phaseout amounts shown in the table below for married taxpayers filing a joint return include the increase provided in § 32(b)(3)(B)(i), as adjusted for inflation for taxable years beginning in 2011.

                          Number of Qualifying Children

 

 Item                     One      Two      Three or More      None

 

 

 Earned Income

 

 Amount                   $9,100    $12,780    $12,780   $6,070

 

 

 Maximum Amount

 

 of Credit                $3,094     $5,112     $5,751     $464

 

 

 Threshold Phaseout

 

 Amount (Single,

 

 Surviving Spouse, or

 

 Head of Household)      $16,690    $16,690    $16,690   $7,590

 

 

 Completed Phaseout

 

 Amount (Single,

 

 Surviving Spouse, or

 

 Head of Household)      $36,052    $40,964    $43,998  $13,660

 

 

 Threshold Phaseout

 

 Amount (Married Filing

 

 Jointly)                $21,770    $21,770    $21,770  $12,670

 

 

 Completed Phaseout

 

 Amount (Married Filing  $41,132    $46,044    $49,078  $18,740

 

 

The instructions for the Form 1040 series provide tables showing the amount of the earned income credit for each type of taxpayer.

(2) Excessive investment income. For taxable years beginning in 2011, the earned income tax credit is not allowed under § 32(i) if the aggregate amount of certain investment income exceeds $3,150.

.05 Standard Deduction.

(1) In general. For taxable years beginning in 2011, the standard deduction amounts under § 63(c)(2) are as follows:

 Filing Status                                Standard Deduction

 

 _____________________________________________________________________

 

 

 Married Individuals Filing Joint Returns

 

 and Surviving Spouses (1(a))                      $11,600

 

 

 Heads of Households (1(b))                         $8,500

 

 

 Unmarried Individuals (other than Surviving

 

 Spouses and Heads of Households) (1(c))            $5,800

 

 

 Married Individuals Filing Separate

 

 Returns (1(d))                                     $5,800

 

 

(2) Dependent. For taxable years beginning in 2011, the standard deduction amount under § 63(c)(5) for an individual who may be claimed as a dependent by another taxpayer cannot exceed the greater of (1) $950, or (2) the sum of $300 and the individual's earned income.

(3) Aged or blind. For taxable years beginning in 2011, the additional standard deduction amount under § 63(f) for the aged or the blind is $1,150. These amounts are increased to $1,450 if the individual is also unmarried and not a surviving spouse.

.06 Qualified Transportation Fringe. For taxable years beginning in 2011, the monthly limitation under § 132(f)(2)(A), regarding the aggregate fringe benefit exclusion amount for transportation in a commuter highway vehicle and any transit pass, and under § 132(f)(2)(B), regarding the fringe benefit exclusion amount for qualified parking, is $230.

.07 Personal Exemption.

(1) Exemption amount. For taxable years beginning in 2011, the personal exemption amount under § 151(d) is $3,700.

.08 Interest on Education Loans. For taxable years beginning in 2011, the $2,500 maximum deduction for interest paid on qualified education loans under § 220 begins to phase out under § 221(b)(2)(B) for taxpayers with modified adjusted gross income in excess of $60,000 ($120,000 for joint returns), and is completely phased out for taxpayers with modified adjusted gross income of $75,000 or more ($150,000 or more for joint returns).

SECTION 3. EFFECTIVE DATE

This revenue procedure applies to taxable years beginning in 2011.

SECTION 4. DRAFTING INFORMATION

The principal author of this revenue procedure is Christina M. Glendening of the Office of Associate Chief Counsel (Income Tax & Accounting). For further information regarding this revenue procedure, contact Ms. Glendening at (202) 622-4920 (not a toll-free call).

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