2020 Federal Tax Law Changes
Business 57.5 cents
Medical 17.0 cents
Charitable 14.0 cents
Mileage Rates
Highlight of Recent Tax Changes
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Tax & Accounting Service
The current standard deduction is $12,400 for singles, up from $12,200 in the prior year, and $24,800 for married joint filers, up from $24,400 in 2019.
IRS has raised the employee contribution limit for 401(k), 403(b) and most 457 plans to $19,500, up from $19,000 in 2019.
If you are age 50 or older, you can kick in an additional $6,500. That's a bump up from $6,000 in 2019.
The maximum Earned Income Credit amount is going up to $6,660 for taxpayers who have 3+ qualifying children.
The IRS annual requirement for taxpayers to inherit an IRA to withdraw a minimum amount has been eliminated. Instead, for 2020 and beyond, the inherited Individual Retirement Accounts will need to be unloaded within 10 years.
Another IRA change is for the age limit. American taxpayers couldn’t make new contributions to Individual Retirement Accounts once they reach the age of 70 and a half. That’s up until this year. Beyond 2020, the age limit is lifted off and taxpayers can keep contributing to their IRAs.
Families who pay for college tuition are now eligible for a deduction of up to $4,000. The base limit for this deduction is $2,000 so you can only claim this deduction if the amount is greater than $2,000 but it cannot exceed $4,000.
