Taxpayers Rejoice!? IRS Adjusts Tax Brackets for 2023

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Inflation's been high for so long, it's gone from munchies to meals! 😆🍬 Just when we were starting to wonder what else Uncle Sam has up his sleeve to bring us down (more snacks?), the IRS is making some adjustments to tax brackets for 2023 returns. 

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💸Inflation causes something called "bracket creep", which means any cost of living adjustment you got in your paycheck could push you into a higher tax bracket. These new changes are the gov-uh-ments way fighting off that creep. 

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Still no word on when Uncle Sam will fight off the creepy men in your DMs. 

Here’s Five Fast Facts on the new creep-fighting tax brackets:

1. 🤓 Crunchin' Numbers and Creeps - In 2023 the standard deduction is going up by $1,800 for married couples filing jointly, $1,400 for heads of households, and $900 for single taxpayers and married taxpayers filing separately.
2. 📠 Mo’ Money, More Creeps - That means 7% more moolah for each type of tax filer…except for the folks making $539k+. They will continue to get tax creeps and likely extra creepy DMs from people looking for sugar mammas. 
3. 🧾 Itemizer, Item-Itemizer, Oh you’re an Itemizer - Itemizing your deductions could be harder next year. Experts say things like mortgage interest and donations might not get you the same tax benefits as they did in previous years.
4. 💰 Credit Check yo’ self- A bunch of tax credits are also getting an inflation adjustment. The income credit for taxpayers with three or more children will be up to nearly $500 more than it was in 2022.
5. 🎁 Wait, There's More! - Also included in these changes: an increase in the gift tax threshold. In 2023, you can give $17,000 in gifts without worrying about taxes. That's a $1,000 increase from $16,000 in 2022. No word yet on the “gift” valuation of the creepy DMs YOU send.

🔥Bottom line: While the fact that this won’t help until next year’s taxes is just a skunk thrown on top of the dumpster fire 2022 economy, it's still a small win for taxpayers. 

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It also pays to make sure you're crossing your T's and dotting your I's when you're filing your return. Mistakes could mean a knock on the door from the IRS and hiding behind the couch only works for so long! For info on avoiding a pesky audit, check out this article.

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What do you think about these new IRS updates?

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