November 01, 1990|By New York Times

High-income taxpayers can do some rough calculations to see where they stand regarding the nation's new tax rules.

The new rules set a top rate of 31 percent, limit itemized deductions and phase out personal exemptions above certain thresholds.

The first number needed is on Line 31 of Form 1040, adjusted gross income. Next is Line 34, itemized deductions. Taxpayers with an adjusted gross income above $100,000 should multiply the difference by .03 to get their deduction limitation. Subtract that number from the itemized deductions to see what would be allowed under 1991 rules. Next, subtract that number and the amount for personal exemptions (Line 36) from the adjusted gross income to get the taxable income.

Though the government has not yet released tax tables to be used under the new law, David A. Berenson, national director of tax policy for Ernst & Young in Washington, has done preliminary calculations to help taxpayers estimate their own rates.

To figure their tax, he said, a married couple filing jointly should subtract $82,050 from taxable income, multiply that result by .31 and add that result to $18,560. (The capital gains portion should be figured at 28 percent.) Single taxpayers should subtract $49,200 from their taxable income, multiply the result by .31 and add that result to $11,130.

Those with taxable income between $150,000 and $272,500 need to add an amount to their taxes for the phaseout of personal exemptions. Above that, exemptions are eliminated. This calculation is considerably more complicated than the 3 percent floor on itemized deductions.

The most anyone could lose would be $636 per exemption (that is, 31 percent of a $2,050 exemption, using the 1990 number) so adding that number times the number of exemptions to the tax owed will give a worst-case scenario.