• 2017 Social Security wage base is $127,200
• Self-employed:
  • 2017 self-employment tax rate is 15.3%, which equals the Social Security rate of 12.4% plus the Medicare tax rate of 2.9%.
  • The 15.3% rate applies to earnings of up to $127,200 after the earnings are reduced by 7.65%. Schedule SE is used to figure Self-employment tax.
  • The 2.9% Medicare rate applies to gross earnings from the first dollar because, unlike the Social Security tax, which is limited to the $127,200 wage base, there is no earnings limit for the Medicare tax.
  • One half of the self-employment tax may be deducted on the first page of Form 1040 as an above-the-line deduction. This means, you don't have to itemize your deductions to claim this deduction.
• Employees:
  • 2017 Social Security rate for employees is 6.2% and 6.2% for employers, for a total rate of 12.4%.
  • The maximum amount of social security tax withholding for an employee should not exceed $7,886.40.
  • The maximum amount of Social Security tax an employer contributes on behalf of each employee should not exceed $7,886.40.
  • 2017 Medicare tax rate for employees is 1.45% and 1.45% for employers, for a total rate of 2.9%.
  • Medicare tax is withheld from all gross wages, regardless of amount.

2017: Each Allowable Exemption is $4,050

Phaseout of Exemption Starts / Ends:

• Joint return/Qualifying widow(er): $313,800 / $436,300
• Head of Household: $287,650 / $410,150
• Single: $261,500 / $384,000
• Married filing separately: $156,900 / $218,150

• Married filing Joint return: $12,700
• Qualifying widow(er): $12,700
• Head of household: $9,350
• Single: $6,350
• Married filing separately: $6,350
• Dependents - minimum deduction: $1,050
• Additional Deduction if Age 65 or Older, or Blind - 2017 (born before January 2, 1953): Note: If you turned 65 on January 1, you are considered to be 65 as of December 31 for purposes of this deduction.
  • Married-per-spouse, filing jointly or separately:
    • $1,250 ($2,500 for age and blindness)
  • Qualifying widow(er):
    • $1,250 ($2,500 for age and blindness)
  • Single or head of household:
    • $1,550 ($3,100 for age and blindness)

• Business: 53.5 cents per mile
• Medical and Moving: 17 cents per mile
• Charitable volunteers: 14 cents per mile

• Free parking, transit passes, and van pooling: $255 per month (same as 2016)
• Qualified bicycle commuting: $20 per month (same as 2016)

Traditional IRAs:

• Traditional IRA contribution limit: $5,500
• Additional contribution if age 50 or older but under 70 1/2: $1,000
• Deduction phaseout for active plan participant:
  • Single or head of household: $62,000 - $72,000
  • Married filing jointly, two participants: $99,000 - $119,000
  • Married filing jointly, one participant:
    • Participant spouse: $99,000 - $119,000
    • Non-participant spouse: $186,000 - $196,000
    • Married filing separately, live together, either participates:
      • $0 - $10,000
  • Married filing separately, live apart all year:
    • Participant spouse: $62,000 - $72,000
    • Non-participant spouse: no phaseout

Roth IRAs:

• Roth IRA contribution limit: $5,500
• Additional contribution if age 50: $1,000
• Contribution limit phaseout range:
  • Single, head of household: $118,000 - $133,000
  • Married filing separately, live apart all year: $118,000 - $133,000
  • Married filing jointly, or qualifying widow(er): $186,000 - $196,000
  • Married filing separately, live together at any time: $0 - $10,000

• 401(k), 403(b), 457 plans: $18,000
• Salary-reduction SEP: $18,000
• SIMPLE IRA: $12,500
• Additional contribution if age 50 or older (catch-up contributions):
  • 401(k), 403(b), governmental 457 and SEP plans: $6,000
  • SIMPLE IRA: $3,000

• American Opportunity credit limit-per student: $2,500
• Lifetime Learning credit limit-per-taxpayer: $2,000
• Phaseout of American Opportunity credit:
  • Married filing jointly: $160,000 - $180,000
  • Single, head of household, or qualifying widow(er): $80,000 - $90,000
• Phaseout of Lifetime Learning credit:
  • Married filing jointly: $112,000 - $132,000
  • Single, head of household, or qualifying widow(er): $56,000 - $66,000
• Student loan interest deduction limit: $2,500
  • Phaseout of deduction limit:
    • Married filing jointly: $135,000 - $165,000
    • Single, head of household, qualifying widow(er): $65,000-$80,000
• Coverdell ESA limit: $2,000
  • Phaseout of limit:
    • Married filing jointly: $190,000 - $220,000
    • All others: $95,000 - $110,000
• Tuition and fees deduction:
  • Tuition and fees deduction: tier 1 limit Income cut-off $4,000
    • Married filing jointly: $130,000
    • Single, head of household, or qualifying widow(er) $65,000
  • Tuition and fees deduction: tier 2 limit Income cut-off $2,000
    • Married filing jointly: $160,000
    • Single, head of household, or qualifying widow(er): $80,000

• Limit on premium allowed as medical expense
  • Age 40 or under: $410
  • Over 40 but not over 50: $770
  • Over 50 but not over 60: $1,530
  • Over 60 but not over 70: $4,090
  • Over 70: $5,110

For qualifying property placed in service in 2017, first-year expensing is allowed up to a limit of $510,000. The limit begins to phase out if the total cost of qualifying property exceeds $2,030,000.

Section 179 Deduction Phase-out:

If the cost of qualifying property placed in service in 2017 is more than $2,030,000, you reduce the $510,000 expensing limit dollar-for-dollar for each dollar the cost of qualifying property exceeds $2,030,000 (but not below zero).

For example, if you place machinery in service during 2017 costing $2,100,000, the $510,000 deduction limit is reduced by $70,000 to $440,000.

If the cost of the property was $2,540,000 or more, you could not take the Section 179 deduction because the $510,000 deduction limit would be completely phased out.

2017 Bonus Depreciation:

The bonus depreciation rate for 2017 is 50%. Bonus depreciation is also called a Section 168(k) allowance and a special depreciation allowance.