The IRS must be calculating inflation differently than the Social Security Administration.
The IRS increased its tax brackets by about 5.4% for tax filers for 2024, including for those filing as married couples or those filing separately. The IRS adjusts tax brackets each year to adjust for inflation.
At the same time, the Social Security Administration has calculated increases to its 71 million recipients at 3.2% to keep up with inflation.
There’s no real explanation about why the government would determine inflation differently, depending on the agency.
For the IRS changed, the tax tops out at 37% for individual taxpayers with marginal incomes greater than $609,350 ($731,200 for married couples filing jointly).
The other rates are:
35% for incomes over $243,725 ($487,450 for married couples filing jointly)
32% for incomes over $191,950 ($383,900 for married couples filing jointly)
24% for incomes over $100,525 ($201,050 for married couples filing jointly)
22% for incomes over $47,150 ($94,300 for married couples filing jointly)
12% for incomes over $11,600 ($23,200 for married couples filing jointly)
The lowest rate is 10% for incomes of single individuals with incomes of $11,600 or less ($23,200 for married couples filing jointly).
- The Alternative Minimum Tax exemption amount for tax year 2024 is $85,700 and begins to phase out at $609,350 ($133,300 for married couples filing jointly for whom the exemption begins to phase out at $1,218,700). For comparison, the 2023 exemption amount was $81,300 and began to phase out at $578,150 ($126,500 for married couples filing jointly for whom the exemption began to phase out at $1,156,300).
- The tax year 2024 maximum Earned Income Tax Credit amount is $7,830 for qualifying taxpayers who have three or more qualifying children, an increase of from $7,430 for tax year 2023. The revenue procedure contains a table providing maximum EITC amount for other categories, income thresholds and phase-outs.
- For tax year 2024, the monthly limitation for the qualified transportation fringe benefit and the monthly limitation for qualified parking increases to $315, an increase of $15 from the limit for 2023.
- For the taxable years beginning in 2024, the dollar limitation for employee salary reductions for contributions to health flexible spending arrangements increases to $3,200. For cafeteria plans that permit the carryover of unused amounts, the maximum carryover amount is $640, an increase of $30 from taxable years beginning in 2023.
- The annual exclusion for monetary gifts to individuals increases to $18,000 for calendar year 2024, increased from $17,000 for calendar year 2023.
- The maximum credit allowed for adoptions for tax year 2024 is the amount of qualified adoption expenses up to $16,810, increased from $15,950 for 2023.
- The personal exemption for tax year 2024 remains at 0, as it was for 2023. This elimination of the personal exemption was a provision in the Tax Cuts and Jobs Act.
- For 2024, as in 2023, 2022, 2021, 2020, 2019 and 2018, there is no limitation on itemized deductions, as that limitation was eliminated by the Tax Cuts and Jobs Act.
- Find out your possible tax liability here.
So the government is still keeping a flawed system that they can manipulate into their benefit. We need a flat tax with no exceptions so everybody has equal skin in the game. Get rid of tax rates and the IRS.
The standard deduction also continues to rise, about another $2,000 for a married couple, and with each increase in the standard deduction a personal income tax becomes more and more expensive even if state and local taxes should once again be deductible. It also implicates, or continues to implicate, the stupidity in having the PFD, which is taxable as ordinary income, concurrent with a state income tax since the income tax is not deductible under most circumstances (should AK ever implement an income tax). An income tax concurrent with the PFD might actually violate the state constitution.
The IRS is the largest single recipient of the PFD. The second largest recipient of the PFD is the child support agency of the Alaska Department of Revenue.
Alaska legislators who push for an income tax are either stupid, socialists, or both.
Many states with an income tax are working toward eliminating it as so many Americans today either don’t work or can work from wherever they want and therefore an income tax is perhaps the largest driver of relocation of earners. People on welfare also tend to relocate for higher net income but Alaska likely has fewer people moving to take advantage of a higher dole than any other state.
A far greater number and higher percentage of Alaskans are on the dole today than was the case when Alaska last had an income tax. That seems to remain true no matter how many job vacancies there are or how much wages rise.
The Grandpa Bloodstains IRS form.
What did you make?
Send it all in. Or else.
(Democrat members of Congress excluded.)
It’s nice when we get to keep some of our money and it sure is charitable and so convenient when the federal government redistributes what some worked to earn to others who did not to somewhat equalize standards of living. Why should people who are motivationally disadvantaged enough to not want to actually work suffer when the rest of us have extra that we’ve been selfishly saving for retirement or other purely personal wants or needs? Modern Americans are so blessed to be living the Marxist motto of “From each according to his ability, to each according to his needs” that past generations scornfully dismissed as “communist claptrap” designed to fleece the working masses to buy the votes of welfare and other types deserving of our cash to maintain the elitist one party system some still disbelieve exists. Onward and upward to the glory of full socialism and the total enslavement of the sheeple class, comrades!
Good job, Senior Contributor!
TRUE INFLATION is actually about 12%. And it topped at about 17.5% under Biden.
“methodological shifts in government reporting have depressed reported inflation, moving the concept of the CPI away from being a measure of the cost of living needed to maintain a constant standard of living.”
THEY LIE!
John William’s Shadow Government Statistics — Alternate Inflation Charts
‘http://www.shadowstats.com/alternate_data/inflation-charts
Good job Senior Contributor trying not to get audited or worse… They WILL find you. Inflation of what people actually have to buy is more like 35%, and for some items if you factor in shrinkflation closer to 80%.
The IRS is changing bracket levels but not enough to prevent “bracket creep” – most of us will pay more and a higher percentage. More incentive to try the homeless approach…
This is why we desperately need to re-elect (again) DJT in 2024. He will approach this problem like the highly successful businessman he is, and run the government like a finely tuned and efficient machine, just like he did before. We’ll spend less, and save more – that’s what the DJT vote will get us.
Trump 2024!
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