IRS News Release  
November 15, 1993

Taxpayers Overlook Key Details
of Tax Law Changes

WASHINGTON - Calls to the Internal Revenue Service show that many taxpayers have questions about some key details of recent tax law changes.

For example, many taxpayers think that everyone's tax rates have gone up. In face, the higher rates affect fewer than two percent of taxpayers. The law created two higher tax rates for 1993, but did not change the income levels for the lower rates.

The new top rates apply for taxable incomes above:

    Filing Status                36 Percent          39.6 Percent

Single                           $115,000               $250,000
Head of Household                 127,500                250,000
Married, joint return             140,000                250,000
Married, separate returns         70,000                125,000

Taxable income is figured by subtracting deductions and personal exemption amounts from your total income.

Some older Americans have expressed concern about new rules for taxing social security benefits. Many senior citizens don't realize that the change won't take place until 1994 and will impact only about 3 million higher-income recipients. Generally, those affected are persons with incomes, including one-half on their social security benefits, over $34,000--over $44,000 of married filing jointly.

Some retailers eligible for luxury tax refunds are delaying the processing of their checks by not following procedures for filing claims. The new law repealed the luxury tax on boats, planes, furs and jewelry retroactive to the beginning of 1993.

Many boat dealers and jewelers especially have omitted their customers' taxpayer identification numbers with their claims. They have also failed to attach an accounting of luxury taxes reported or paid during 1993, refunds claimed, and the remaining tax eligible for refund. Retailers preparing their own refund claims should get the instructions for Form 720 for detailed information.

IRS assistors have received special training in the new tax law changes and can help taxpayers who need information. Taxpayers should call IRS toll-free at 1-800-829-1040.

Previous | Next

1993 IRS News Releases | News Releases Main | Home