Amid inflation, the IRS this week announced higher federal taxes and standard deductions for 2023.
The agency increased the income threshold for each bracket, effective in the 2023 tax year for returns filed in 2024.
These brackets show how much you owe in federal taxes on each portion of your “taxable income,” calculated by subtracting the greater of your standard or itemized deductions. of your income.
Higher standard deduction
The standard deduction will also increase in 2023, rising to $27,700 for couples living together, rising to $25,900 in 2022. Single filers can claim $13,850, up from $12,950. dollars.
Other tax conditions adjust
The IRS also raised figures for dozens of other measures, such as the minimum tax, a matching system for high earners and tax exemptions for wealthy families.
A higher income tax credit is also available, raising the exemption to a maximum of $7,430 for low- to moderate-income savers. And employees can add $3,050 to a health care expense account.
Although the agency has not yet released a 2023 limit for 401(k) and individual retirement accounts, experts predict that the IRA limit will jump to $6,500 for saver under 50 years of age.