Greetings!

Tax Day for most United States taxpayers fell on Tuesday, April 18^th, 2023, excluding the handful of states that have extended deadlines this year because of disaster emergencies and anyone who requested an extension.  Each year, adjustments are made by the IRS to account for the effects of inflation.  Inflation has been a hot topic recently and current adjustments for 2023 are available.  This article will highlight some key tax figures¹ for the 2023 tax year:

Standard Deduction:

• Single taxpayers: $13,850
• Married filing jointly: $27,700
• Heads of households: $20,800

Marginal Income Tax Rates:

• Single taxpayers
  • 12% for incomes over $11,000
  • 22% for incomes over $44,275
  • 24% for incomes over $95,375
  • 32% for incomes over $182,100
  • 35% for incomes over $231,250
  • 37% for incomes over $578,125
• Married filing jointly
  • 12% for incomes over $22,000
  • 22% for incomes over $89,450
  • 24% for incomes over $190,750
  • 32% for incomes over $364,200
  • 35% for incomes over 462,500
  • 37% for incomes over $693,750

Capital Gain Tax Rates:

• Short Term: Marginal Income Tax Rate
• Long Term:
  • Single: $0 – $44,624 (Married filing jointly: $0 – 89,249) – 0% Long term rate
  • Single: $44,625 – $492,299 (Married filing jointly: $89,250 – $553,849 – 15% Long term rate
  • Single: over $492,299 (Married filing jointly: over $553,849) – 20% Long term rate

IRA and Roth IRA Contribution Limits (100% of taxable compensation up to the limits below):

• Under Age 50 – $6,500
• Age 50 and older – $7,500

401(k), 403(b), and SIMPLE-IRA Contribution Limits (Lesser of 100% of your salary or limits below):

• 401(k) and 403(b) – $22,500
• SIMPLE-IRA – $15,500
• Age 50 or older catch-up contributions for 401(k) and 403(b) – $7,500
• Age 50 or older catch-up contributions for SIMPLE IRA – $3,500

Annual Gift Tax Exclusion:

• Single – $17,000
• Married – $34,000

Lifetime Estate and Gift Tax Exemption:

• Estate tax exemption – $12,920,000
• Gift tax exemption – $12,920,000

This list is not meant to be exhaustive, however, please feel free to reach out to us if you have any questions regarding how these adjustments may affect your financial situation.  The Normandy Group strives to work in a collaborative environment with your CPAs and tax professionals.  One of the core elements within our Dynamic Wealth Design is tax planning.  Our goal is to be as efficient as possible when it pertains to income, capital gain, gift, and estate taxes, and we find that working with a team of professionals may give the best potential for successful outcomes.

The CERTIFIED FINANCIAL PLANNER™ professionals and Certified Estate Planners™ at The Normandy Group offer serious financial insights for today’s complex world.  By combining investment, tax, risk transference techniques and estate planning strategies we can help you to provide clarity regarding your goals. Contact us today for a complimentary consultation.

Best regards,

Charley

(1) https://www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2023

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