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Personal exemption
Under United States tax law, a personal exemption is an amount that a resident taxpayer is entitled to claim as a tax deduction against personal income in calculating taxable income and consequently federal income tax. In 2017, the personal exemption amount was $4,050, though the exemption is subject to phase-out limitations. The personal exemption amount is adjusted each year for inflation. The Tax Cuts and Jobs Act of 2017 eliminated personal exemptions for tax years 2018 through 2025, and the One Big Beautiful Bill Act made the elimination permanent except for taxpayers aged 65 and up.
The exemption is composed of personal exemptions for the individual taxpayer and, as appropriate, the taxpayer's spouse and dependents, as provided in Internal Revenue Code at 26 U.S.C. § 151.
Section 151 of the Internal Revenue Code was enacted in August 1954, and provided for deductions equal to the "personal exemption" amount in computing taxable income. The exemption was intended to insulate from taxation the minimal amount of income someone would need receive to live at a subsistence level (i.e., enough income for food, clothes, shelter, etc.).[citation needed] In addition to personal exemptions, taxpayers may claim other deductions that further reduce the level of income subject to taxation.
Generally speaking, for tax years prior to 2018, a personal exemption can be claimed by the taxpayer and qualifying dependents. A personal exemption may also be claimed for a spouse if (1) the couple files separately, (2) the spouse has no gross income, and (3) the spouse is not the dependent of another, §151(b). For taxpayers filing a joint return with a spouse, the Treasury Regulations allow two personal exemptions as well.
If a taxpayer could be claimed as a dependent by another taxpayer (regardless of whether anyone actually claims them), he or she cannot claim a personal exemption for himself or herself.
In computing taxable income, taxpayers may claim all personal exemptions for which they are eligible under §151, and deduct that amount from the adjusted gross income (AGI).
The personal exemptions begin to phase out when AGI exceeds $309,900 for 2017 joint tax returns and $258,250 for 2017 single tax returns. Each tax exemption is reduced by 2% for each $2,500 by which a taxpayer's AGI exceeds the threshold amount until the benefit of all personal exemptions is eliminated.
In 2017, the personal exemption amount was $4,050, and it began to phase out at, and reached the maximum phaseout amount after, the following adjusted gross income amounts:
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Personal exemption
Under United States tax law, a personal exemption is an amount that a resident taxpayer is entitled to claim as a tax deduction against personal income in calculating taxable income and consequently federal income tax. In 2017, the personal exemption amount was $4,050, though the exemption is subject to phase-out limitations. The personal exemption amount is adjusted each year for inflation. The Tax Cuts and Jobs Act of 2017 eliminated personal exemptions for tax years 2018 through 2025, and the One Big Beautiful Bill Act made the elimination permanent except for taxpayers aged 65 and up.
The exemption is composed of personal exemptions for the individual taxpayer and, as appropriate, the taxpayer's spouse and dependents, as provided in Internal Revenue Code at 26 U.S.C. § 151.
Section 151 of the Internal Revenue Code was enacted in August 1954, and provided for deductions equal to the "personal exemption" amount in computing taxable income. The exemption was intended to insulate from taxation the minimal amount of income someone would need receive to live at a subsistence level (i.e., enough income for food, clothes, shelter, etc.).[citation needed] In addition to personal exemptions, taxpayers may claim other deductions that further reduce the level of income subject to taxation.
Generally speaking, for tax years prior to 2018, a personal exemption can be claimed by the taxpayer and qualifying dependents. A personal exemption may also be claimed for a spouse if (1) the couple files separately, (2) the spouse has no gross income, and (3) the spouse is not the dependent of another, §151(b). For taxpayers filing a joint return with a spouse, the Treasury Regulations allow two personal exemptions as well.
If a taxpayer could be claimed as a dependent by another taxpayer (regardless of whether anyone actually claims them), he or she cannot claim a personal exemption for himself or herself.
In computing taxable income, taxpayers may claim all personal exemptions for which they are eligible under §151, and deduct that amount from the adjusted gross income (AGI).
The personal exemptions begin to phase out when AGI exceeds $309,900 for 2017 joint tax returns and $258,250 for 2017 single tax returns. Each tax exemption is reduced by 2% for each $2,500 by which a taxpayer's AGI exceeds the threshold amount until the benefit of all personal exemptions is eliminated.
In 2017, the personal exemption amount was $4,050, and it began to phase out at, and reached the maximum phaseout amount after, the following adjusted gross income amounts:
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