Many tax benefits and credits begin to phase-out at certain income levels. The phase-outs are based on Adjusted Gross Income (AGI). The phase out ranges for 2011 have increased for the cost of living:
2011 Phase-Outs
Phase-Out Begins
Phase-Out Complete
Eligible to Make Roth IRA Contributions
Married filing jointly
$169,000
$179,000
Single
$107,000
$122,000
Head of household
$107,000
$122,000
Married filing separately
$0
$10,000
Deduction of IRA Contributions
Married filing jointly, participating spouse
$90,000
$119,000
Married filing jointly, non-participating spouse
$169,000
$179,000
Single
$56,000
$66,000
Head of household
$56,000
$66,000
Married filing separately
$0
$10,000
American Opportunity Credit
(formerly the Hope Education Credit)
Married filing jointly
$160,000
$180,000
Single
$80,000
$90,000
Head of household
$80,000
$90,000
Married filing separately
N/A
N/A
Lifetime Learning Credit
Married filing jointly
$102,000
$122,000
Single
$51,000
$61,000
Head of household
$51,000
$61,000
Married filing separately
N/A
N/A
Student Loan Interest Deduction
Married filing jointly
$120,000
$150,000
Single
$60,000
$75,000
Head of household
$60,000
$75,000
Married filing separately
N/A
N/A
Child Tax Credit
For all filing Statuses-
Married filing jointly
$110,000
Phased out by $50 for each
Single
$75,000
$1,000 over threshhold until
Head of household
$75,000
credit (based on # of children)
Married filing separately
$55,000
reduced to zero
To ensure compliance with Treasury Circular 230, we are required to inform you that any advice concerning U.S. federal tax issues contained on this website is not intended or written to be used, and cannot be used, for the purpose of avoiding penalties under the Internal Revenue Code and was not written to support the promotion or marketing of any transaction or matter discussed herein. Application of tax regulations is specific to the individual or business and we recommend that you consult a qualified Komisar Brady tax professional for how the above information may apply to you.
