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2023 Tax Changes

2023 will be a year of change-for taxes that is! Read on to see what changes were made by the government:

 

  • Standard deductions are increasing.

    • Single; Married Filing Separately: $12,950 to $13,850 in 2023.

    • Married Filing Jointly; Qualifying Widow(er): $25,900 to $27,700.

    • Head of Household: $19,400 to $20,800.

 

  • 401K pre-tax contributions are increasing.

    • Taxpayers can contribute up to $22,500 in 2023, up from the $20,500 in 2022.

 

  • Earned Income Tax Credits are increasing.

    • $7,430 for qualifying taxpayers with three or more children, up from $6,935 in 2022.

 

  • Annual exclusion of gifts is increasing.

    • $17,000, up from $16,000 in 2022.

 

  • Social Security Wage Cap and Benefit Amounts increase.

    • The benefits will increase by 8.7% in 2023 and the wage cap will be $160,200 up from the $147,000 it was in 2022.

 

  • The standard mileage rates for the use of a car (also vans, pickups or panel trucks) has increased. These rates apply to electric, hybrid, gasoline, and diesel-powered vehicles.

    • 65.5 cents per mile driven for business use. This rate is 3 cents more than the 2022 mid-year increase.

    • 22 cents per mile driven for medical or moving purposes for qualified active-duty members of the Armed Forces. This rate remains unchanged from the 2022 mid-year increase.

    • 14 cents per mile driven in service of charitable organizations. This rate remains unchanged from 2022 since it is set by statute.

 

  • Pennsylvania state unemployment (SUI) increased from 0.06% to 0.07%.

 

With so many changes on the horizon, questions are bound to arise.  At Hark and Associates, PC, we are here to provide high quality service with the highest ethical standards in the business of CPA firms. If you have questions about your taxes, one of our knowledgeable accountants is happy to help. Schedule your consultation today.

Susan White