The current federal individual income tax rates are set to expire at the end of 2012. Should Congress raise or lower the tax rates next year or keep them the same? That’s the debate that has begun. Competing visions of tax changes have been introduced in Congress:
Because this is an election year, it may be that Congress simply extends the current Bush-era tax rates for another year, which would allow the new Congress to take up the matter.
Items, such as interest, state and local income and sales taxes, charitable contributions, and medical deductions, claimed on Schedule A of Form 1040. Itemized deductions are subtracted from adjusted gross income to arrive at taxable income. The amount of itemized deductions is also subject to a reduction when adjusted gross income exceeds certain limits.