The IRS just released the new tax inflation adjustments for 2022. As you are likely aware the IRS adjusts some tax deductions and income limits for inflation each year. The new 2022 tax numbers are higher across the board thanks to higher inflation numbers than the last few years.
New 2022 Standard Deduction
The Trump tax changes implemented under the Tax Cuts and Jobs Act made the standard deduction higher and eliminated some itemized deductions. As a result, far more people take the standard deduction on taxes than did before. The law did remove the limitation for itemized deductions that do remain. 2021 standard deduction numbers can be found here.
The standard deduction for 2022 for married filing jointly is $25,900.
The standard deduction for 2022 for single filers is $12,950.
New 2022 Tax Brackets
The tax brackets for 2022, more formally known as the Marginal Rates, reflect higher starting incomes for each tax bracket in 2022. 2021 tax brackets information is here.
New 2022 Tax Brackets Single Filer
- 10% Tax Bracket $10,275 or less
- 12% Tax Bracket $10,275 and over
- 22% Tax Bracket $44,775 and over
- 24% Tax Bracket $89,075 and over
- 32% Tax Bracket $170,050 and over
- 35% Tax Bracket $215,950 and over
- 37% Tax Bracket $539,900 and over
New 2022 Tax Brackets Married Filing Jointly
- 10% Tax Bracket $20,550 or less
- 12% Tax Bracket $20,550 and over
- 22% Tax Bracket $83,550 and over
- 24% Tax Bracket $178,150 and over
- 32% Tax Bracket $340,100 and over
- 35% Tax Bracket $431,900 and over
- 37% Tax Bracket $647,850 and over
New 2022 Flexible Spending Accounts (FSA) Limits
The new limit for Flexible Spending Accounts, or FSA accounts, is $2,850 with a maximum carryover of $570.
For Medical Savings Accounts for tax year 2022
For tax year 2022, participants who have self-only coverage in a Medical Savings Account, the plan must have an annual deductible that is not less than $2,450, up $50 from tax year 2021; but not more than $3,700, an increase of $100 from tax year 2021. For self-only coverage, the maximum out-of-pocket expense amount is $4,950, up $150 from 2021. For tax year 2022, for family coverage, the annual deductible is not less than $4,950, up from $4,800 in 2021; however, the deductible cannot be more than $7,400, up $250 from the limit for tax year 2021. For family coverage, the out-of-pocket expense limit is $9,050 for tax year 2022, an increase of $300 from tax year 2021.IRS provides tax inflation adjustments for tax year 2022 | Internal Revenue Service
2022 Estate Tax Limits
Another of the 2022 tax numbers is the estate tax limits.
The basic exclusion from estate taxes for people who die in 2022 is up to $12,060,000.
The annual gift tax exclusion is $16,000.
2022 401k Contribution Limit
The 2022 contribution limit for 401k plans, 403(b) plans, and most 457 plans will increase to $20,500 from $19,500.
The 2022 contribution limit for IRAs including Roth IRAs remains at $6,000 with an addition $500 catch up contribution allowed for those age 50 and over.
State Income Taxes
Then, don’t forget that Republicans capped the amount you can deduct from state taxes at $10,000.
Author – Brian Nelson
Brian is a former Certified Financial Planner and financial advisor. He writes for the Finance Gourmet and other financial publications. The material provided on this website is for informational use only and is not intended for financial or tax advice. ArcticLlama, LLC, FinanceGourmet.com, and Brian Nelson, assume no liability for any loss or damage resulting from one’s reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own tax professional when making decisions regarding your tax situation.