As we say goodbye to 2023, staying in the loop about the new tax regulations will help you avoid any wanted surprises next year.
Last month, the IRS announced updates for the 2024 tax brackets.
And because of high inflation and other economic woes, you can expect higher brackets, tax deductions, and more.
This article will guide you through every update to ensure you won’t miss out on anything this tax season!
What Are 2024’s Tax Brackets Like?
Here’s a quick rundown of what next year’s tax brackets will look like:
Single Filers
- 10% for incomes up to $11,600
- 12% for incomes between $11,601 and up to $47,150
- 22% for incomes between $47,151 and up to $100,525
- 24% for incomes between $100,526 and up to $191,950
- 32% for incomes between $191,951 and up to $243,725
- 35% for incomes between $243,726 and up to $609,350
- 37% for incomes over $609,350
Head Of Household
- 10% for incomes up to $16,550
- 12% for incomes between $16,551 and up to $63,100
- 22% for incomes between $63,101 and up to $100,500
- 24% for incomes between $100,501 and up to $191,950
- 32% for incomes between $191,951 and up to $243,700
- 35% for incomes between $234,701 and up to $609,350
- 37% for incomes over $609,350
Married Couples Filing Jointly
- 10% for incomes up to $23,200
- 12% for incomes between $23,001 and up to $94,300
- 22% for incomes between $94,301 and up to $201,050
- 24% for incomes between $201,051 and up to $383,900
- 32% for incomes between $383,901 and up to $487,450
- 35% for incomes between $487,451 and up to $731,200
- 37% for incomes over $731,200
Married Couples Filing Separately
- 10% for incomes up to $11,600
- 12% for incomes between $11,601 and up to $47,150
- 22% for incomes between $47,151 and up to $100,525
- 24% for incomes between $100,526 and up to $191,950
- 32% for incomes between $191,951 and up to $243,725
- 35% for incomes between $243,726 and up to $365,600
- 37% for incomes over $365,600
Other Reforms & Perks To Look Out For
Higher Standard Deduction
The standard deduction is set to rise in 2024, moving up to $29,200 for married couples filing jointly and $14,600 for single taxpayers. This increase mainly keeps up with inflation and gives you a slightly lower tax burden.
Free Tax Filing in 13 States
The IRS is introducing a new free tax filing program in 13 states for the 2024 tax season, including New York, California, Arizona, and Massachusetts.
This initiative aims to make tax filing more accessible and less burdensome for taxpayers in these states. If successful, this could overhaul how we do taxes in the future.
New Paperless Initiatives
The IRS is moving towards a more environmentally friendly, efficient process with a new Paper Processing Initiative. In the near future, 94% of tax filers could send their forms electronically.
With an average tax preparation service costing from $200 to $600, you could save hundreds yearly. Going digital will also help streamline the tax filing process, reduce errors, and speed up refunds.
Additional IRS Tax Provisions 2024
Besides higher brackets and standard deductions, the IRS has come out with a handful of other provisions and boosting the threshold for key programs next year, including:
- alternative minimum tax
- estate tax exemption
- earned income tax credit
- health flexible spending account contributions
- 401(k), 403(b), and 457 plan employee contribution limit
Take advantage of these changes and save more this upcoming tax season!
The Bottom Line
Next year’s tax brackets and provisions for 2024 will keep pace with inflation, adding some much-needed relief to taxpayers.
Whether you’re a single filer or doing taxes as a family, these updates can significantly impact your financial health.
Remember, the last day to file is April 15, 2024, so make sure to file everything on time and avoid missing the deadline! Or file an extension if you need to.
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