The Internal Revenue Service released its inflation adjustments for 2023 federal income tax rates and brackets this week.
The IRS automatically adjusts tax rates each year to reflect inflation. Usually these adjustments are small. But following the fastest price growth in four decades, Americans can expect noticeably higher tax brackets and a larger standard deduction next tax year.
The breakpoint for each tax bracket will be about 7% higher across the board in 2023.
The IRS hasn’t yet released 2023 limits for 401(k) accounts and individual retirement accounts (IRAs), but those numbers are expected next month.
2023 Tax Brackets
