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Pagio's & Associates LLC

Tax Rates

Tax Rates

2021 Tax Rates – Single Taxpayers – Standard Deduction $12,550
10% 0 to $9,950.
12% $9,950 to $40,525
22%$40,525 to $86,375
24%$86,375 to $164,925
32%$164,925 to $209,425
35%$209,425 to $523,600
37%Over $518,400

2021 Tax Rates – Married Jointly & Surviving Spouses – Standard Deduction
10%0 to $19,900
12%$19,900 to $81,050
22%$81,050 to $172,750
24%$172,750 to $329,850
32%$329,850 to $418,850
35%$418,850 to $628,300
37%Over $628,300

2021 Tax Rates – Married Filing Separately – Standard Deduction $12,550
10%0 to $9,950
12%$9,950 to $40,525
22%$40,525 to $86,375
24%$86,355 to $164,925

32%$164,925 to $209,425
35%$209,425 to $314,150
37%Over $314,150
2021 Tax Rates – Head of Household – Standard Deduction $18,800
10%0 to $14,200
12%$14,200 to $54,200
22%$54,200 to $86,350
24%$86,350 to $164,900
32%$164,900 to $209,400
35%$209,400 to $523,600
37%Over $523,600

2021 Tax Rates – Estates & Trusts
10%0 to $2,650
24%$2,650 to $9,550
35%$9,550 to $13,050
37%Over $13,050

2021 Tax Rates
Social Security Tax Rate: Employers6.2%
Social Security Tax Rate: Employees6.2%
Social Security Tax Rate: Self-Employed15.3%
Maximum Taxable Earnings $142,800
Medicare Base SalaryUnlimited
Medicare Tax Rate: Employers1.45%
Medicare Tax Rate: Employees1.45%
Additional Medicare Tax for income above $200,000 (single filers) or $250,000
(joint filers)0.9%
Medicare tax on net investment income ($200,000 single filers, $250,000 joint
filers) 3.8%


2021 Tax Rates
Business expensing limit: Cap on equipment purchases $2,620,000
Business expensing limit: New and Used Equipment and Software $1,050,000
Qualified Business Income threshold amount:
$164,925 (single and head of household); $329,800 (married filing joint return)
Qualified Small Employer Health Reimbursement Arrangement limit:
$5,300 (single coverage); $10,700 (family coverage)
Prior-year safe harbor for estimated taxes of higher-income
110% of your 2020 tax liability
Standard mileage rate for business driving 56 cents
Standard mileage rate for medical driving 16 cents

Standard mileage rate for moving driving – Members of the Armed Forces on
active duty who move because of a permanent change of station 16 cents
Standard mileage rate for charitable driving 14 cents
Child Tax Credit
$2,000 Unearned income maximum for children under 19 before kiddie tax
$1,100 Maximum capital gains tax rate for taxpayers with income up to $40,400
for single filers, $80,800 for married filing jointly 0%
Maximum capital gains tax rate for taxpayers with income above $40,400 for
single filers, $80,800 for married filing jointly 15%
Maximum capital gains tax rate for taxpayers with income above $445,850 for
single filers, $501,600 for married filing jointly 20%
Capital gains tax rate for unrecaptured Sec. 1250 gains 25%
Capital gains tax rate on collectibles 28%
Maximum contribution for Traditional/Roth IRA
$6,000 if under age 50
$7,000 if 50 or older
Maximum employee contribution to SIMPLE IRA
$13,500 if under age 50
$16,500 if 50 or older
Maximum Contribution to SEP IRA
25% of eligible compensation
up to $58,000
401(k) maximum employee contribution limit
$19,500 if under age 50
$26,000 if 50 or older
Estate tax exemption
Annual Exclusion for Gifts


2021 Tax Rates
American Opportunity Credit (Hope) $2,500
Lifetime Learning Credit $2,000
Student Loan Interest Deduction $2,500
Coverdell Education Savings Contribution $2,000
Source: IRS Revenue Procedure 2020-45

Record retention Guide
Storing tax records: How long is long enough?

Federal law requires you to maintain copies of your tax returns and
supporting documents for three years. This is called the "three-year law"
and leads many people to believe they're safe provided they retain their
documents for this period of time.
However, if the IRS believes you have significantly underreported your
income (by 25 percent or more), or believes there may be indication of
fraud, it may go back six years in an audit. To be safe, use the following
Business Records To Keep…
Personal Records To Keep…
Special circumstances
Create a Backup Set of Records and Store Them Electronically.
Keeping a backup set of records — including, for example, bank
statements, tax returns, insurance policies, etc. — is easier than ever now
that many financial institutions provide statements and documents
electronically, and much financial information is available on the Internet.
Even if the original records are provided only on paper, they can be
scanned and converted to a digital format. Once the documents are in
electronic form, taxpayers can download them to a backup storage device,
such as an external hard drive, or burn them onto a CD or DVD (don't
forget to label it).
You might also consider online backup, which is the only way to ensure
that data is fully protected. With online backup, files are stored in another
region of the country, so that if a hurricane or other natural disaster occurs,
documents remain safe.
Caution: Identity theft is a serious threat in today's world, and it is
important to take every precaution to avoid it. After it is no longer
necessary to retain your tax records, financial statements, or any other
documents with your personal information, you should dispose of these
records by shredding them and not disposing of them by merely throwing
them away in the trash.

Business Documents To Keep For One Year
• Correspondence with Customers and Vendors
• Duplicate Deposit Slips
• Purchase Orders (other than Purchasing Department copy)
• Receiving Sheets
• Requisitions
• Stenographer's Notebooks

• Stockroom Withdrawal Forms

Business Documents To Keep For Three Years
• Employee Personnel Records (after termination)
• Employment Applications
• Expired Insurance Policies
• General Correspondence
• Internal Audit Reports
• Internal Reports
• Petty Cash Vouchers
• Physical Inventory Tags
• Savings Bond Registration Records of Employees
• Time Cards For Hourly Employees

Business Documents To Keep For Six Years
• Accident Reports, Claims
• Accounts Payable Ledgers and Schedules
• Accounts Receivable Ledgers and Schedules
• Bank Statements and Reconciliations
• Cancelled Checks
• Cancelled Stock and Bond Certificates
• Employment Tax Records
• Expense Analysis and Expense Distribution Schedules
• Expired Contracts, Leases
• Expired Option Records
• Inventories of Products, Materials, Supplies
• Invoices to Customers
• Notes Receivable Ledgers, Schedules
• Payroll Records and Summaries, including payment to
• Plant Cost Ledgers
• Purchasing Department Copies of Purchase Orders
• Sales Records
• Subsidiary Ledgers
• Time Books
• Travel and Entertainment Records
• Vouchers for Payments to Vendors, Employees, etc.
• Voucher Register, Schedules

Business Records To Keep Forever
While federal guidelines do not require you to keep tax records "forever," in
many cases there will be other reasons you'll want to retain these
documents indefinitely.
• Audit Reports from CPAs/Accountants
• Cancelled Checks for Important Payments (especially tax

• Cash Books, Charts of Accounts
• Contracts, Leases Currently in Effect
• Corporate Documents (incorporation, charter, by-laws, etc.)
• Documents substantiating fixed asset additions
• Deeds
• Depreciation Schedules
• Financial Statements (Year End)
• General and Private Ledgers, Year End Trial Balances
• Insurance Records, Current Accident Reports, Claims,
• Investment Trade Confirmations
• IRS Revenue Agents' Reports
• Journals
• Legal Records, Correspondence and Other Important Matters
• Minute Books of Directors and Stockholders
• Mortgages, Bills of Sale
• Property Appraisals by Outside Appraisers
• Property Records
• Retirement and Pension Records
• Tax Returns and Worksheets
• Trademark and Patent Registrations
Personal Documents To Keep For One Year
• Bank Statements
• Paycheck Stubs (reconcile with W-2)
• Canceled checks
• Monthly and quarterly mutual fund and retirement contribution
statements (reconcile with year end statement)
Personal Documents To Keep For Three Years
• Credit Card Statements
• Medical Bills (in case of insurance disputes) 
• Utility Records
• Expired Insurance Policies 
Personal Documents To Keep For Six Years
• Supporting Documents For Tax Returns
• Accident Reports and Claims
• Medical Bills (if tax-related)
• Property Records / Improvement Receipts
• Sales Receipts
• Wage Garnishments
• Other Tax-Related Bills
Personal Records To Keep Forever
• CPA Audit Reports

• Legal Records
• Important Correspondence
• Income Tax Returns
• Income Tax Payment Checks
• Investment Trade Confirmations
• Retirement and Pension Records
Special Circumstances
• Car Records (keep until the car is sold)
• Credit Card Receipts (keep with your credit card statement)
• Insurance Policies (keep for the life of the policy)
• Mortgages / Deeds / Leases (keep 6 years beyond the
• Pay Stubs (keep until reconciled with your W-2)
• Property Records / improvement receipts (keep until property
• Sales Receipts (keep for life of the warranty)
• Stock and Bond Records (keep for 6 years beyond selling)
• Warranties and Instructions (keep for the life of the product)
• Other Bills (keep until payment is verified on the next bill)
• Depreciation Schedules and Other Capital Asset Records
(keep for 3 years after the tax life of the asset)

Privacy Policy
We collect nonpublic personal information about you from the following
• Information we receive from you on applications, tax
organizers, worksheets and other documents;

• Information about your transactions with us, our affiliates, or

• Information we receive from a consumer-reporting agency.
We do not disclose any nonpublic personal information about our
clients or former clients to anyone, except as permitted by law.
We restrict access to nonpublic personal information about you to those
members of our firm who need to know that information to provide services
to you. We maintain physical, electronic, and procedural safeguards that

comply with federal regulations to guard your nonpublic personal
If you have any questions about this policy, please do not hesitate to
contact us.