{"id":31445,"date":"2023-11-06T08:00:00","date_gmt":"2023-11-06T14:00:00","guid":{"rendered":"https:\/\/taxprocenter.proconnect.intuit.com\/?p=31445"},"modified":"2023-11-01T12:07:49","modified_gmt":"2023-11-01T17:07:49","slug":"annual-inflation-adjustments-for-ty-2022-and-2023","status":"publish","type":"post","link":"https:\/\/accountants.intuit.com\/taxprocenter\/tax-law-and-news\/annual-inflation-adjustments-for-ty-2022-and-2023\/","title":{"rendered":"Annual inflation adjustments for TY 2022 and 2023"},"content":{"rendered":"\n

The following chart outlines the year-over-year inflation adjustments on some higher impact provisions of the tax code. You can refer to these figures in planning for tax year 2023, and consider sharing with your individual and business tax clients. Also refer to the resources at the bottom for additional adjustments.<\/p>\n\n\n\n

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 <\/td>Tax Year 2022<\/strong><\/td>Tax Year 2023<\/strong><\/td><\/tr>
Standard deduction  <\/td>Married filing jointly: $25,900Single taxpayers and married individuals filing separately: $12,950Heads of households: $19,400<\/td>Married filing jointly: $27,700Single taxpayers and married individuals filing separately: $13,850Heads of households: $20,800<\/td><\/tr>
Personal exemption<\/td>$0  <\/td>$0  <\/td><\/tr>
Tax rates and brackets<\/td>Top rate is 37 percent for individual single taxpayers with incomes greater than $539,900 ($647,850 for married couples filing jointly).35 percent, for incomes over $215,950 ($431,900 for married couples filing jointly)32 percent for incomes over $170,050 ($340,100 for married couples filing jointly)24 percent for incomes over $89,075 ($178,150 for married couples filing jointly)22 percent for incomes over $41,775 ($83,550 for married couples filing jointly)12 percent for incomes over $10,275 ($20,550 for married couples filing jointly)Lowest rate is 10 percent for incomes of single individuals with incomes of $10,275 or less ($20,550 for married couples filing jointly)<\/td>Top rate is 37 percent for individual single taxpayers with incomes greater than $578,125 ($693,750 for married couples filing jointly).35 percent, for incomes over $231,250 ($462,500 for married couples filing jointly)32 percent for incomes over $182,100 ($364,200 for married couples filing jointly)24 percent for incomes over $95,375 ($190,750 for married couples filing jointly)22 percent for incomes over $44,725 ($89,450 for married couples filing jointly)12 percent for incomes over $11,000 ($22,000 for married couples filing jointly)Lowest rate is 10 percent for incomes of single individuals with incomes of $11,000 or less ($22,000 for married couples filing jointly)<\/td><\/tr>
Alternative minimum tax exemption<\/td>$75,900 for single individuals and begins to phase out at $539,900$118,100 for married couples filing jointly and begins to phase out at $1,079,800<\/td>$81,300 for single individuals and begins to phase out at $578,150$126,500 for married couples filing jointly and begins to phase out at $1,156,300<\/td><\/tr>
Penalty for not maintaining minimum essential health<\/td>$0<\/td>$0<\/td><\/tr>
Dollar limitation for employee salary reductions for contributions to health flexible spending arrangements<\/td>$2,850<\/td>$3,050<\/td><\/tr>
Adjusted gross income amount used by joint filers to determine the reduction in the Lifetime Learning Credit<\/a><\/td>$160,000<\/td>$160,000<\/td><\/tr>
Maximum credit allowed for adoptions<\/td>$14,890<\/td>$15,950<\/td><\/tr>
Foreign earned income exclusion<\/td>$112,000<\/td>$120,000<\/td><\/tr>
Basic exclusion amount for estates of decedents  <\/td>Estates of decedents who die during 2022: $12,060,000<\/td>Estates of decedents who die during 2022: $12,920,000<\/td><\/tr>
Annual exclusion for gifts<\/td>$16,000<\/td>$17,000<\/td><\/tr>
Standard mileage rates for the use of a car (also vans, pickups or panel trucks)<\/td>58.5 (62.5 for dates: 7\/1 \u2013 12\/31) cents per mile driven for business use,18 (22 for dates: 7\/1 \u2013 12\/31) cents per mile driven for medical or moving purposes, and14 cents per mile driven in service of charitable organizations<\/td>65.5 cents per mile driven for business use,22 cents per mile driven for medical or moving purposes, and14 cents per mile driven in service of charitable organizations<\/td><\/tr>
Monthly limit on qualified transportation fringe benefits & qualified parking<\/td>$280<\/td>$300<\/td><\/tr>
Contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government\u2019s Thrift Savings Plan<\/td>$20,500<\/td>$22,500<\/td><\/tr>
Catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans and the federal government\u2019s Thrift Savings Plan<\/td>$6,500<\/td>$7,500<\/td><\/tr>
Limit on annual contributions to an IRA<\/td>$6,500<\/td>$6,500<\/td><\/tr>
Catch-up contribution limit for individuals aged 50 and over (IRA)<\/td>$1,000<\/td>$1,000<\/td><\/tr>
If during the year either the taxpayer or their spouse was covered by a retirement plan at work, the deduction may be reduced, or phased out, until it is eliminated, depending on filing status and income<\/td>For single taxpayers covered by a workplace retirement plan, the phase-out range is: $68,000 to $78,000For married couples filing jointly, where the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is: $109,000 to $129,000For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains: $0 to $10,000<\/td>For single taxpayers covered by a workplace retirement plan, the phase-out range is: $73,000 to $83,000For married couples filing jointly, where the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is: $116,000 to $136,000For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains: $0 to $10,000<\/td><\/tr>
For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple\u2019s income is between:<\/td>$204,000 and $214,000<\/td>$218,000 and $228,000<\/td><\/tr>
Income phase-out range for taxpayers making contributions to a Roth IRA:<\/td>For singles and heads of household: $129,000 to $144,000For married couples filing jointly, the income phase-out range is: $204,000 to $214,000The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment adjustment and and remains: $0 to $10,000<\/td>For singles and heads of household: $138,000 to $153,000For married couples filing jointly, the income phase-out range is: $218,000 to $228,000The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains: $0 to $10,000<\/td><\/tr>
Income limit for the Saver\u2019s Credit (also known as the Retirement Savings Contributions Credit) for low- and moderate-income workers<\/a><\/td>Married couples filing jointly: $68,000Heads of household: $51,000 Singles and married individuals filing separately: $34,000  <\/td>Married couples filing jointly: $73,000Heads of household: $54,750 Singles and married individuals filing separately: $36,500<\/td><\/tr>
SIMPLE retirement contribution limit<\/td>$14,000<\/td>$15,500<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Resources<\/strong><\/p>\n\n\n\n