Kathy Tomasiak, CPA

Reviewing…Tax Rates and Other Information:

INDIVIDUAL TAX RATES are 10%, 12%, 22%, 24%, 32%, 35% and 37%.

Personal Exemptions have been eliminated.
(Keep in mind – names, social security numbers and birth dates of dependents will be needed for possible other credits available)

Tax Cut and Job Act

STANDARD DEDUCTION for 2022 according to your filing status:

  • Married filing jointly – $25,900
  • Head of Household – $19,400
  • Single – $12,950
    Note – those 65 and older receive an additional deduction

REMINDER, your deductions, listed below are a few things to consider:

Medical deductions are first reduced by 7.5% of adjusted gross income

The total of all state/local/real estate taxes are limited to $10,000

Miscellaneous itemized deductions subject to 2% adjusted gross income have been eliminated. These expenses include unreimbursed employee business expenses, investment expenses, tax preparation fees, advisory fees from brokerage accounts, safe deposit boxes, etc.

529 PLANS expands the definition of “qualified education expenses”:

Funds can be used for elementary and secondary public, private or religious schools

  • $10,000 per student, per year allowed
  • Funds can be used to pay student loans
  • $10,000 per beneficiary, lifetime

Other Updates Include:

  • Required Minimum Distribution age limit has increased to 72 years old
  • Those who were 70 ½ prior to 2020 are subject to the previous RMD rules
  • Contributions to IRA’s no longer are restricted by your age as long as you have earned income and qualify to make a contribution
  • Consider direct contributions from your RMD to allow tax savings for both federal and state taxes

HSA Contributions

2022 – Single Plan $3,650
2023 – Single Plan $3,850

2022 – Family Plan $7,300
2023 – Family Plan $7,750

Over 55, an additional contribution of $1,000 is allowed

Keep in mind, contributions to HSA’s for a 2022 deduction can be made up until the tax filing date, Tuesday, April 18, 2023.

  • Annual exclusion for a gift is $16,000 (for 2023, $17,000)
  • Alimony payments are no longer deductible by the payer or included in income of the recipient, for agreements executed after January 1, 2019.
  • Social Security annual wage base for 2023 is $160,200