The Internal Revenue Service released inflation-adjusted tax brackets for next year on Tuesday. The changes could boost your paycheck in 2023.
For single taxpayers, the standard deduction rises rose to $13,850, up $900.That means your top tax rate might have gone down. For example, if you were earning $90,000 a year in 2022 your top tax rate was 32%. Next year it's 24%." — when your salary rises to keep up with inflation, propelling you into a higher tax bracket.
This is easy to understand if you go back and look at salaries from decades ago. Say the IRS tax brackets were still set at a , then someone earning $34,000 a year — a tidy sum at the time — would face a 49% tax rate. That would be considered extremely regressive in 2022.; they went into effect in 1985. Before then, a period when inflation was high, brackets weren't adjusted.
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