Projected 2019 Inflation-Adjusted Tax Brackets and Other Key Figures
Each year, the income tax brackets, standard deduction amounts, and many other tax items are adjusted for cost-of-living increases.
The Tax Cuts and Jobs Act (TCJA; P.L. 115-97), which was enacted on December 22, 2017, changed the relevant measure of inflation from the average Consumer Price Index for All Urban Consumers (CPI-U) for the 12-month period ending the previous August 31 to the average chained CPI-U (C-CPI-U) for the same period. In general, the C-CPI-U grows at a slower pace because it takes into account a consumer’s ability to substitute between goods in response to changes in relative prices.
The August 2018 CPI was released by the Labor Department on September 13, 2018. Using the C-CPI-U for August 2018 (and the preceding 11 months), Thomson Reuters Checkpoint has calculated the 2019 indexed amounts, including:
- Key individual tax items
- Expensing figures and "small business" limitations
- Health, charitable, compliance, and other specialty items
- Transfer tax and foreign items
- Various civil penalties
This special report presents the updated numbers for 2019.
The TCJA (like most new legislation) contains a number of errors and ambiguities and has not yet been subject to a technical corrections bill. Where these issues arose in the context of inflation adjustments, we construed provisions in the way that seemed the most consistent with Congressional intent, reflecting our assumption that these ambiguities will eventually be resolved accordingly. While these projections reflect our best judgment, it is nonetheless worth noting that there are instances where the statute could be interpreted in a contrary manner.