2023 Taxes

[MsTG1]

Can you give an overall review on any 2023 personal tax changes?

[kfenwick]

If you have purchased the TurboTax Live product, you have access to a CPA for the entire tax year to assist with questions on your tax return or issues that arise outside of the tax filing period.  Contact TurboTax customer service to see if your eligible for these benefits.  Call our customer service number at 1-800-446-8848.

[Kearbie]

Hello MsTG1

Thank you for your question.  The IRS has announced these changes regarding the 2023 tax year adjustments: 

Highlights of changes in Revenue Procedure 2022-38

The tax year 2023 adjustments described below generally apply to tax returns filed in 2024.

The tax items for tax year 2023 of greatest interest to most taxpayers include the following dollar amounts:

• The standard deduction for married couples filing jointly for tax year 2023 rises to $27,700 up $1,800 from the prior year. For single taxpayers and married individuals filing separately, the standard deduction rises to $13,850 for 2023, up $900, and for heads of households, the standard deduction will be $20,800 for tax year 2023, up $1,400 from the amount for tax year 2022.
   
• Marginal Rates: For tax year 2023, the top tax rate remains 37% for individual single taxpayers with incomes greater than $578,125 ($693,750 for married couples filing jointly).
• The tax year 2023 maximum Earned Income Tax Credit amount is $7,430 for qualifying taxpayers who have three or more qualifying children, up from $6,935 for tax year 2022. The revenue procedure contains a table providing maximum EITC amount for other categories, income thresholds and phase-outs.
   
• For tax year 2023, the monthly limitation for the qualified transportation fringe benefit and the monthly limitation for qualified parking increases to $300, up $20 from the limit for 2022.
   
• For the taxable years beginning in 2023, the dollar limitation for employee salary reductions for contributions to health flexible spending arrangements increases to $3,050. For cafeteria plans that permit the carryover of unused amounts, the maximum carryover amount is $610, an increase of $40 from taxable years beginning in 2022.
   
• For tax year 2023, participants who have self-only coverage in a Medical Savings Account, the plan must have an annual deductible that is not less than $2,650, up $200 from tax year 2022; but not more than $3,950, an increase of $250 from tax year 2022. For self-only coverage, the maximum out-of-pocket expense amount is $5,300, up $350 from 2022. For tax year 2023, for family coverage, the annual deductible is not less than $5,300, up from $4,950 for 2022; however, the deductible cannot be more than $7,900, up $500 from the limit for tax year 2022. For family coverage, the out-of-pocket expense limit is $9,650 for tax year 2023, an increase of $600 from tax year 2022.
   
• For tax year 2023, the foreign earned income exclusion is $120,000 up from $112,000 for tax year 2022.
   
• Estates of decedents who die during 2023 have a basic exclusion amount of $12,920,000, up from a total of $12,060,000 for estates of decedents who died in 2022.
   
• The annual exclusion for gifts increases to $17,000 for calendar year 2023, up from $16,000 for calendar year 2022.
   
• The maximum credit allowed for adoptions for tax year 2023 is the amount of qualified adoption expenses up to $15,950, up from $14,890 for 2022

[kfenwick]

Here is a summary of the individual tax law changes that may affect your return.

The 2023 tax year standard deduction for married couples filing jointly will be $27,700, up $1,800 from the deduction for the 2022 tax year. For single taxpayers, the standard deduction is $13,850, up $900.

This link has a mixture of 2022 and 2023 and beyond tax changes.

IRS link for some 2023 tax year 2023 tax law changes