Each year we prepare a summary of important tax items for use by lawyers in the firm, clients and friends. The following summary is for calendar year 2019. Because of the changes in income tax law at both the federal and state level, these tables use simplifying assumptions that may or may not apply to individual situations, so check with us or other tax advisers if you have questions.
Tax Rates for Married Filing Jointly and Surviving Spouses Filing Joint Returns
| Taxable Income | Up to | Federal Rate | Maine Rate | Combined Effective Rate* |
| 0 | $19,400.00 | 10.0% | 5.80% | 15.2% |
| $19,401.00 | $43,700.00 | 12.0% | 5.80% | 17.1% |
| $43,701.00 | $78,950.00 | 12.0% | 6.75% | 17.9% |
| $78,951.00 | $103,400.00 | 22.0% | 6.75% | 27.3% |
| $103,401.00 | $168,400.00 | 22.0% | 7.15% | 27.6% |
| $168,401.00 | $321,450.00 | 24.0% | 7.15% | 29.4% |
| $321,451.00 | $408,200.00 | 32.0% | 7.15% | 36.9% |
| $408,210.00 | $612,350.00 | 35.0% | 7.15% | 39.6% |
| Over | $612,350.00 | 37.0% | 7.15% | 41.5% |
Single Filers
| Taxable Income | Up to | Federal Rate | Maine Rate | Combined Effective Rate* |
| 0 | $9,700.00 | 10.0% | 5.80% | 15.2% |
| $9,701.00 | $21,850.00 | 12.0% | 5.80% | 17.1% |
| $21,851.00 | $39,475.00 | 12.0% | 6.75% | 17.9% |
| $39,476.00 | $51,700.00 | 22.0% | 6.75% | 27.3% |
| $51,701.00 | $84,200.00 | 22.0% | 7.15% | 27.6% |
| $84,201.00 | $160,725.00 | 24.0% | 7.15% | 29.4% |
| $160,725.00 | $204,100.00 | 32.0% | 7.15% | 36.9% |
| $204,101.00 | $510,300.00 | 35.0% | 7.15% | 39.6% |
| Over | $510,300.00 | 37.0% | 7.15% | 41.5% |
Head of Household
| Taxable Income | Up to | Federal Rate | Maine Rate | Combined Effective Rate* |
| 0 | $13,580.00 | 10.0% | 5.80% | 15.2% |
| $13,851.00 | $32,750.00 | 12.0% | 5.80% | 17.1% |
| $32,751.00 | $52,850.00 | 12.0% | 6.75% | 17.9% |
| $52,851.00 | $77,550.00 | 22.0% | 6.75% | 27.3% |
| $77,551.00 | $84,200.00 | 22.0% | 7.15% | 27.6% |
| $84,201.00 | $160,700.00 | 24.0% | 7.15% | 29.4% |
| $160,701.00 | $204,100.00 | 32.0% | 7.15% | 36.9% |
| $204,100.00 | $510,300.00 | 35.0% | 7.15% | 39.6% |
| Over | $510,300.00 | 37.0% | 7.15% | 41.5% |
*Effective rates assume full deduction for state income tax.
Corporations
| Taxable Income | Up to | Federal Rate | Maine Rate | Combined Effective Rate* |
| 0 | $350,000.00 | 21.0% | 3.50% | 23.77% |
| $350,001.00 | $1,050,000.00 | 21.0% | 7.93% | 27.26% |
| $1,050,001.00 | $3,500,000.00 | 21.0% | 8.33% | 27.58% |
| Over | $3,500,000.00 | 21.0% | 8.93% | 28.05% |
Estates and Trusts
| Taxable Income | Up to | Federal Rate | Maine Rate | Combined Effective Rate* |
| 0 | $2,600.00 | 10.0% | 5.80% | 15.2% |
| $2,601.00 | $9,300.00 | 24.0% | 5.80% | 28.4% |
| $9,301.00 | $12,750.00 | 35.0% | 5.80% | 38.8% |
| $12,751.00 | $21,100.00 | 37.0% | 5.80% | 40.7% |
| $21,101.00 | $50,000.00 | 37.0% | 6.75% | 41.3% |
| Over | $50,000.00 | 37.0% | 7.15% | 41.5% |
Long term capital gains tax 15.0% 7.15% 21.08%
And dividend rate (effective for capital gains realized on or after May 6, 2003)
Those in 10% ordinary bracket qualify for 0% rate on long term capital gains and dividends.
Other 2019 Items
| Standard Deduction | Maine | |
| Joint or surviving spouse | $24,400.00 | $24,400.00 |
| Single | $12,200.00 | $12,200.00 |
| Head of Household | $18,350.00 | $18,350.00 |
The personal exemption has been eliminated for federal income taxes. Maine’s is $4,200. Itemized deductions for state and local taxes (SALT) are limited to $10,000 on federal returns. Maine limits itemized deductions to $10,000, increased by real and personal property taxes that cannot be claimed for federal income tax due to $10,000 limitation.
Social Security Wage Base 2019 $132,900.00
FICA + Medicaid tax rate (OASDI + HI) 7.65%
Self Employment tax rate 15.30%
FICA and Medicare tax on base $10,166.85
FICA tax is 6.2% on both employee and employer and Medicaid 1.45% on both, without limit
Self employment tax is 12.4% social security plus 2.9 % Medicare (hospital insurance), 15.3% total. Thus a self-employed individual pays a total tax on the amount of the wage base of $132,900.
Retirement
The maximum annual addition to a defined contribution retirement plan is $56,000
The maximum amount for elective deferrals (401k) is $19,000
The annual compensation limit for figuring contributions is $280,000
Taxpayers 50 and above may make catch-up contributions as follows:
The IRA catch up rate is $1,000 and is not adjusted for inflation.
The 401(k), 457, 403(b), and SEPs amount is $6,000
SIMPLE plans have a permanent $2,500 catch-up limit.
Estate and Gift Tax
Federal estate and gift tax exemptions are both set at $11,400,000 with “portability” of unused exemptions. This means a married couple has a combined exclusion of $22,800,000 available without regard to who owns the assets at death.
Maine has once again “decoupled” its estate tax exemption, which now is $5,712,000 (est.) without “portability.” This means careful planning will be needed for Maine residents with estates larger than the single $5.7 million exemption.
For 2019 the Gift tax annual exclusion is $15,000.
Prepared by Bryan M. Dench, Esq., Skelton Taintor & Abbott