Inflation to lower taxes in 2009

According to Tom Herman, Why Inflation Means Relief For Taxpayers, Wall St. J., Sept. 17, 2008, “[n]o matter who wins the White House, most taxpayers can look forward to some relief next year.”

Here are Mr. Herman’s predictions based on inflation data recently released by the Labor Department:

• Gift tax annual exclusion will increase from $12,000 to $13,000.
• Standard income tax deduction for married couples filing jointly will increase from $10,900 to $11,400.
• The amount of income needed before losing the benefits of certain itemized deductions will increase from $159,950 to $166,800.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.