East Tennessee's Mountain Views

East Tennessee's Mountain Views

Contact Us

P.O. Box 209

Vonore, TN 37885


Beware – 2016 Is Almost Here

Wednesday, November 4th, 2015 | Uncategorized | No Comments

Are You Ready?

Employer’s with 100 or more full-time-equivalent employees are required to offer health insurance coverage to employees who work more than 30 hours a week or pay a penalty (technically a tax). For 2016, employers with 50 to 99 full-time-equivalent employees will be subject to pay-or-play rules. Coverage will also be expanded to dependents.

Taxes or penalties, whichever term you choose to use, are stiff. In 2015, employers who fail to offer coverage to at least 70% of full-time workers can be subject to $2,084 times the number of full-time employees, less 80, if even one full-time employee chooses to buy insurance through the Exchange and receives a tax credit to subsidize their premium.

Employers who fail to provide affordable insurance will owe a tax equal to $3,126 for each full-time employee who gets a tax credit for purchasing insurance on an Exchange. To be considered affordable, the premium contribution from the employee for individual coverage cannot exceed 9.5% of the employee’s compensation.

Individuals who go without insurance will see an increase in the tax they pay. The basic fine will increase to $325 per person ($162.50 for each family member under 18), with a maximum of $975. The tax can go as high as 2% of the excess household income over the tax return filing threshold.

Sound complicated? Yes, indeed.

Other provisions also increase. The standard deduction increases to $12,600 for those filing as married. Those filing single will see an increase to $6,300. The personal exemption will increase to $4,000.

The Social Security wage base for 2016 will not increase; it will remain the same as 2015, which is $118,500. The Social Security Administration recently announced that Social Security Benefits will also remain the same as 2015, with no increase. The earned income limits for those retiring before reaching their full retirement age is expected to remain the same for 2016, which is $15,720.

The standard mileage rate for 2015 is 57.5 cents per mile for business travel. For medical travel, the rate is 23 cents, and for moving and charitable travel, the rate is 14 cents.

On December 31, 2015, the Tennessee Death Tax will be abolished. The federal estate and gift tax exemption for 2015 is $5,430,000. This number is scheduled to increase each year based on an index, so it is anticipated to increase again in 2016. For 2015, the gift tax exclusion remained at $14,000.

Here are a few last minute tax breaks to consider before December 31:
» Take some last minute tax deductions, such as contributions to charity, paying property taxes, and contribution to retirement accounts.
» Defer income. If you think you may be in a lower tax bracket in 2016, postpone income until 2016.
» Sell investments with a loss to offset gains. A key strategy for investors could be to sell stocks or mutual funds that are in a loss position to offset capital gains.
» Contribute the maximum to retirement accounts – an opportunity to defer income. Increase your 401(k) contribution to the maximum amount; consider contributing to an Individual Retirement Account.
» Over 70½, don’t forget to take your minimum required distribution. Failing to take at least the required minimum distribution triggers a penalty of 50% excise tax on the amount you should have withdrawn. You might also consider having income taxes automatically withheld from your distribution to avoid any underpayment penalties.

The tax professionals at Warren & Tallent can assist you in determining how to reduce your taxes and to get the most out of your tax deductions. Call for an appointment today. Contact us at our Sweetwater location at (423) 337-5003 or our Madisonville location at (423) 442-3890.

Warren & Tallent
606C South Main Street in Sweetwater
(423) 337-5003

409 North College Street, Suite 2 in Madisonville
(423) 442-3890


Leave a Reply

East Tennessee's Mountain Views

P.O. Box 209

Vonore, TN 37885

Email: inquiry@etmv.com

865-657-3077 Local

© 2024 East Tennessee's Mountain Views. All Rights Reserved.

Website design by Slamdot.