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IRS increases standard deduction, personal exemption and lifetime estate tax exemption

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The IRS has announced its annual cost-of-living and inflation adjustments for 2015, offering taxpayers a bigger standard deduction, personal exemption, and lifetime gift and estate tax exclusion.

Tax laws require the IRS to adjust the dollar amounts of dozens of tax provisions each year to account for inflation. Rev. Proc. 2014-61 adjusts the tax brackets with an approximate inflation rate of just 1.7%.