The IRS has changed the tax codes for the upcoming 2022 tax year. So, what changes can you expect to your tax bracket and other deductions after having gone through an inflation 30-year high?

1. Standard Deductions will Increase (Depending on how you file)
   1. For married couples filing jointly,the standard deduction rises to $25,900, up $800 from the prior year
   2. For single taxpayers and married individuals filing separately, the standard deduction rises to $12,950 for 2022, up $400
   3. For heads of households, the standard deduction will be $19,400 for tax year 2022, up $600
2. Tax Brackets will Increase (Married filing jointly)
   1. 10%: Taxable income up to $20,550 (up from $19,900 for 2021)
   2. 12%: Taxable income between $20,550 to $83,550 (up from $19,900 to $81,050 for 2021)
   3. 22%: Taxable income between $83,550 to $178,150 (up from $81,050 to $172,750 for 2021)
   4. 24%: Taxable income between $178,150 to $340,100 (up from $172,750 to $329,850 for 2021)
   5. 32%: Taxable income between $340,100 to $431,900 (up from $329,850 to $418,850 for 2021)
   6. 35%: Taxable income between $431,900 to $647,850 (up from $418,850 to $628,300 for 2021)
   7. 37%: Taxable income over $647,850 (up from $628,300 for 2021)
3. Tax Brackets will Increase (Individual single taxpayer)
   1. 10%: Taxable income up to $10,275 (up from $9,950 for 2021)
   2. 12%: Taxable income between $10,275 to $41,775 (up from $9,950 to $40,525 for 2021)
   3. 22%: Taxable income between $41,775 to $89,075 (up from $40,525 to $86,375 for 2021)
   4. 24%: Taxable income between $89,075 to $170,050 (up from $86,375 to $164,925 for 2021)
   5. 32% Taxable income between $170,050 to $215,950 (up from $164,925 to $209,425 for 2021)
   6. 35%: Taxable income between $215,950 to $539,900 (up from $209,425 to $523,600 for 2021)
   7. 37%: Taxable income over $539,900 (up from $523,600 for 2021)
4. Tax Advantaged Contributions will Increase (Individual single taxpayer)
   1. 401(k): The IRS recently announced changes to retirement contribution limits. You can save an extra $1,000 in your 401(k) in 2022
   2. HSA: The individual limit for annual contributionswas previously increased for 2022 to $4,950, and the family plan maximum jumped up to $7,400

 

Adapted from Grow Acorns1

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• https://grow.acorns.com/irs-new-2022-tax-code-changes/

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