Your 2023 Tax Brackets vs. 2022 Tax Brackets
We're still in 2022, but you filed your 2021 tax returns in April. You might be thinking, "Gosh! I wonder what the tax brackets for the 2023 tax years are?
We have you covered. And there is some good news thanks to inflation. The Internal Revenue Service (IRS), adjusts tax brackets to reflect inflation every year. Because inflation is so high, you may fall to a lower bracket based on the income you earn in 2023. The standard deduction, which is the amount that you can take as a deduction but without itemizing, will also increase.
Register Now
You can start planning now to lower your 2023 tax bill. The tax brackets for 2023 will help you plan smart tax strategies such as adjusting your income tax mitholding so that you don't end up with a large tax bill next year.
How do brackets work
The U.S. tax system has graduated income tax rates. This means that different income amounts are subject to different tax rates. These tax brackets married filing jointly are made up of seven. You pay more for the more money you earn.
Importantly, the highest tax bracket does not reflect how much federal income taxes you have to pay. You won't have to pay 22 percent if you are a single-filer in the 22 percent tax bracket 2023. The 10% tax on income above $11,000 is payable, the 12 percent for amounts between $11,000 and $44,725, as well as the 22 percent for any amount beyond that (upto $95,375).
Tax brackets on income earned in 2022
37% on incomes above $539,900 ($647.850 for married couples filing jointly).
35% on incomes above $215,950 (or $4431,900 for married couples filing jointly).
32% on incomes above $170,050 (340,100 for married couples filing together)
24% on incomes above $89,075 ($178.150 for married couples filing jointly).
22% on incomes above $41,775 ($83.550 for married couples filing jointly).
For incomes above $10,275, 12% ($20,550 for married couples filing jointly).
10% on incomes below $10,275 ($20,550 for married couples filing jointly).
Separately married couples pay the same rate as those who are not married. Source: Internal Revenue Service
Tax brackets on income earned in 2023
37% on incomes above $578,125 ($693,750 if married couples filing jointly).
35% on incomes above $231,250 (or $4462,500 for married couples filing jointly).
32% on incomes above $182,100 (364,200 for married couples filing together)
24% on incomes above $95,375 ($190,000.75 for married couples filing jointly).
22% on incomes above $44,725 ($89.450 for married couples filing jointly).
For incomes above $11,000, 12% (for married couples filing jointly),
10% on incomes below $11,000 ($22,000 for married couples filing together)
Separately married couples pay the same rate as those who are not married. Source: Internal Revenue Service
The standard deduction for single filers will increase to $13,850 in the 2023 tax year from $12,950 last year. For couples filing jointly, the standard deduction will increase to $27700 in 2023 from $25,900 in 2022. Single filers 65 years and older, who are not the spouse of another person, can increase their standard deduction by $1850. Joint filers 65 years and older can each increase the standard deduction by $1500 per person, or $3,000 if they are not surviving spouses. For more details to visit website filemytaxesonline.org
As mandated by 2017 tax reform, the IRS uses the chained consumers price index (CPI), to measure inflation. The chained CPI, which measures changes in prices for approximately 80,000 items, is similar to the consumer price index. Chained CPI accounts for the fact that consumers will often substitute for other items when prices rise for certain items. People will switch to chicken if the price of beef increases.