Due to the rampant inflation, the Internal Revenue Service announced on Tuesday that it has adjusted tax code parameters for 2023, which means that many Americans could end up taking home more money from their paychecks next year.
With inflation at a 40-year high, the IRS is hiking the standard deduction by about 7 percent for 2023, The Hill reported.
The standard deduction reduces the amount of income that a person is taxed so by increasing the standard deduction, the adjustment means Americans can protect more of their personal income from basic income taxes, the Wall Street Journal reported.
According to the IRS news release on Tuesday, the standard deduction for married couples who filed jointly will rise by $1,800 in 2023.
So married couples will have a standard deduction of $27,700 in 2023. In 2022 it was $25,900.
The standard deduction for individuals filing on their own will go up by $900 in 2023, to $13,850, the IRS reported.
Heads of households will have a standard deduction of $20,800 in 2023, which is a $1,400 increase from 2022, the IRS added.
Meanwhile, the IRS also outlined the marginal tax rate bracket, and “the top tax rate remains 37% for individual single taxpayers with incomes greater than $578,125 ($693,750 for married couples filing jointly).”
The rest of the income bracket’s marginal rates are “35% for incomes over $231,250 ($462,500 for married couples filing jointly); 32% for incomes over $182,100 ($364,200 for married couples filing jointly); 24% for incomes over $95,375 ($190,750 for married couples filing jointly); 22% for incomes over $44,725 ($89,450 for married couples filing jointly); 12% for incomes over $11,000 ($22,000 for married couples filing jointly),” the IRS news release outlined.
These changes, particularly the standard deduction adjustment, are a reflection of the serious impact that Americans are suffering due to inflation and are meant to shield taxpayers from inflationary tax increases, the Journal reported.
Every year, the IRS makes small adjustments to the tax parameters, according to formulas set by Congress, to align with the economy and economic projections for the following year, the Journal reported.
With inflation so high, the annual adjustment for 2023 is the largest adjustment to the standard deduction since 1985, which was just a few years after inflation was as high as it is now.
Congress indexed tax codes to inflation for the first time in 1985.
While the standard deduction is one of the biggest tax code adjustments so far, the IRS also announced smaller changes, such as an increase for employee contributions to health care flexible spending accounts, and an increase in exclusion amounts for estates taxes and annual gift taxes.
Foreign-earned income exclusions will also be increased for 2023.
All in all, for the average taxpayer, the tax code adjustment should show up in the new year and their paychecks will show that tax withholding is a bit lower and take-home income will be increased a bit.
While the IRS’s announcement on Tuesday outlined a significant number of tax code changes, more information on tax adjustments is expected in the coming days and weeks since the IRS did not announce information on changes to retirement accounts and contributions to 401(k)s, the Journal noted.
So Americans can expect more changes to the tax code, which will affect some of their finances in 2023.
over tax again from dems and rinos
I dont believe one thing the left says and dont trust that much that they do. They will take it back fast if you vote them back in.
Millions of us are waiting for the announcement of them being disbanded, and being recognized as a domestic terrorist organization, for the entire agency to be interrogated at Guantanamo Bay and their sentences carried out according to their crimes against America and Americans for their treasonous Acts of stealing a dually elected presidents term in office and voters votes away impeding and blocking investigation into their own criminal behavior and a million more charges too many to list,
The FBI IRS CIA ARE ALL SUBVERSIVE ANTI PEOPLE ANTI AMERICA
AND NEED TO BE ERADICATED AT ONCE
I’ve got a better idea: Since this current ILLEGITIMATE ‘Administration’ has weaponized, (literally) EVERY alphabet agency in our government, (including the IRS), I say we cut the snake off at the head, and (before they send the goon squads to our house to kill us), WE KILL every fucking person in this current ILLEGITIMATE ‘Administration’. How’s THAT for a ‘remedy’?
If you think anything less is going to stop this current INSANITY, THINK AGAIN!
We’re no longer living in a Constitutional Republic, but under a neo-Marxist regime, who not only doesn’t recognize the Constitution, but also rule of law. History has taught us the only way a country can rid itself from a tyrannical dictatorship is by ELIMINATING THE DICTATORS – BY WHATEVER MEANS NECESSARY.
ONE BULLET IN LESS THAN ONE SECOND – that’s all it could take to change the course of history.
If someone/anyone would have been successful in assassinating Hitler any time before September 1, 1939, WWII WOULD HAVE NEVER HAPPENED. Think about that for a minute. Millions of people wouldn’t have needlessly died. Hundreds of thousands of young soldiers would have been spared. TRILLIONS of dollars wouldn’t have been expended.
ONE BULLET IN LESS THAN ONE SECOND – DONE!
Just in time for the election. And we actually get to keep a few cents more. Sounds like they’re trying to buy more Democrat votes.