NEW YORK (CNN) — For those who want to plan ahead for their taxes, the IRS this week announced new inflation-adjusted income tax brackets and standard deduction amounts for the 2024 tax year.
Translation: These are the numbers associated with the tax returns most Americans will file in early 2025.
The IRS adjusts for inflation each year It applies to tax brackets, standard deductions, and several other tax breaks. Alex Durante, an economist at the Tax Foundation, said the changes are aimed at protecting taxpayers from the effects of inflation. However, the net effect of this change is not to significantly change an individual’s tax burden.
Put another way: “Inflation adjustments aren’t putting extra money in people’s pockets. They face a tax increase if their inflation-adjusted income (also known as real income) rises by 7%. “It only prevents them from doing so,” wrote Robert McClelland, senior fellow at the Tax Policy Center. blog post.
Higher basic deduction amount
For individuals and married people filing separately, the new federal standard deduction next year will be $14,600, up from this year’s $13,850.
For married couples filing jointly, the standard deduction will increase from the current $27,700 to $29,200.
Additionally, for those filing as heads of households, the standard deduction will increase from the current $20,800 to $21,900.
Most filers claim the standard deduction.others will too You can save even more It also applies to tax-advantaged 401(k)s and IRAs.
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