It won’t be long before you’ll be fussin’ and cussin’ again as you gather all the tax information needed to step back in the ring with the IRS on April 15th. The standard deduction and all tax brackets have been adjusted for the 2023 tax year. Here are the numbers that will be used to determine what you owe.

 

Standard Deduction

The standard deduction reduces a taxpayer’s taxable income by a flat dollar amount which is determined by the government. Beginning with the Tax Cuts and Jobs Act in 2017, the standard deduction was doubled for all classes of filers as an incentive for taxpayers not to itemize deductions. Today, almost 88% of taxpayers choose the standard deduction.

 

For the 2023 tax year, the standard deduction for taxpayers under age 65 will be:

  • $27,700 for those married filing jointly or surviving spouse, up from $25,900 in 2022
  • $20,800 for head of household, up from $19,400 in 2022
  • $13,850 for single or married filing separately, up from $12,950 in 2022

 

Seniors and blind taxpayers

There is a higher standard deduction for senior citizens and blind persons. For 2023, those individuals receive an additional $1,500 per person. So, for a married couple, if both individuals are 65 or older, their standard deduction will be $30,700 ($27,700 + $1,500 + $1,500).

 

You can find out more about the higher standard deduction for seniors and the blind in IRS Publication 501.

https://www.irs.gov/forms-pubs/about-publication-501

 

2023 tax brackets

Tax brackets are about taxable income—the amount after deductions and credits. Here’s what the brackets look like for 2023:

 

Married filing jointly and survivors

  • Up to $22,000 – 10%
  • $22,000-$89,450 -12%
  • $89,450-$190,750 – 22%
  • $190,750-$364,200 – 24%
  • $364,200-$462,500 – 32%
  • $462,500-$693,750 – 35%
  • Above $693,750 – 37%

 

Head of Household

  • Up to $15,700 – 10%
  • $15,700-$59,850 – 12%
  • $59,850-$$95,350 – 22%
  • $95,350-$182,100 – 24%
  • $182,100-$231,250 – 32%
  • $231,250-$578,100 – 35%
  • $578,100 and above – 37%

 

Single

  • Up to $11,000 – 10%
  • $11,000-$44,725 – 12%
  • $44,725-$95,375 – 22%
  • $95,375-$182,100 – 24%
  • $182,100-$231,250 – 32%
  • $231,250-$578,125 – 35%
  • Above $578,125 – 37%

 

Married filing separately

  • Up to $11,000 – 10%
  • $11,000-$44,725 – 12%
  • $44,725-$95,375 – 22%
  • $95,375-$182,100 – 24%
  • $182,100-$231,250 – 32%
  • $231,250-$346,875 – 35%
  • Above $346,875 – 37%

 

Happy filing!

 

 

Disclaimer

This information is presented for informational purposes only and does not constitute an offer to sell, or the solicitation of an offer to buy any investment products. None of the information herein constitutes an investment recommendation, investment advice, or an investment outlook. The opinions and conclusions contained in this report are those of the individual expressing those opinions. This information is non-tailored, non-specific information presented without regard for individual investment preferences or risk parameters. Some investments are not suitable for all investors, all investments entail risk and there can be no assurance that any investment strategy will be successful. This information is based on sources believed to be reliable and Alhambra is not responsible for errors, inaccuracies, or omissions of information. For more information contact Alhambra Investment Partners at 1-888-777-0970 or email us at info@alhambrapartners.com.