What The Tax Rates For 2004 ?

Note: The graduated rates below are based on TAXABLE INCOME, which is your adjusted gross income reduced by your allowable deductions (either itemized deductions or the standard deduction) and your allowable deduction for personal exemptions.

Rather than do the math required for the calculation of the tax from these schedules, you may find it easier to use the Tax Tables or Schedules contained in the instructions for the form you are filing.

Standard Deduction (add 3 ^rd column if over age 65 or blind EACH)

Married Filing Jointly and Qualifying Widow(er) $9,700 $950

Single $4,850 $1,150

Head of Household $7,150 $1,150

Married Filing Separately $4,850 $950

Personal exemptions for 2004 are $3,100

Note that both itemized deductions and personal exemptions are subject to phase-outs for certain high income taxpayers. Check Form 1040 instructions.

2004 TAX RATES

Married Filing Jointly and Qualifying Widow(er) $0 to $14,300 10%

$14,301 to $58,100 15%

$58,101 to $117,250 25%

$117,251 to $178,650 28%

$178,651 to $319,100 33%

$319,101 & Over 35%

Single $0 to $7,150 10%

$7,151 to $29,050 15%

$29,051 to $70,350 25%

$70,351 to $146,750 28%

$146,751 to $319,100 33%

$319,101 & Over 35%

Head of Household $0 to $10,200 10%

$10,201 to $38,900 15%

$39,000 to $100,500 25%

$100,501 to $162,700 28%

$162,701 to $319,100 33%

$319,101 & Over 35%

Married Filing Separately $0 to $7,150 10%

$7,150 to $29,050 15%

$29,050 to $58,625 25%

$58,626 to $89,325 28%

$89,326 to $159,550 33%

$159,551 & Over 35%

Tax Rate on Dividends and Capital Gains

Dividends.

Taxed as a maximum rate of 15% for clients in the higher brackets and just 5% for taxpayers in the 10% and 15% brackets. This change is retroactive to Jan. 1, 2003 and is scheduled to remain in effect through 2008, except in the year 2008 the rate falls to zero for taxpayers in the 10% and 15% brackets. Beginning Jan. 1, 2009, dividend taxation reverts to current law.

Capital gains.

15% for clients in the higher brackets and 5% for people in the 10% and 15% brackets. This new rate applies for assets sold on or after May 6, 2003, and before Jan. 1, 2009. As with dividends, the capital gains tax rate is zero in the year 2008 for people in the 10% and 15% bracket.

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