IRS Adjusts Core Tax Features 4 Inflation

Good news is IRS is boosting standard deduction by 7% to help offset 8+% inflation. Bad news is agency is also upping upper tax bracket by 7% to keep Swamp filled with coins. Think nation’s record debt will balloon too?

According to the WSJ: “The 37% top marginal tax rate will apply to individual income above $578,125 & married couples’ income above $693,750 next year, as those thresholds go up 7% from 2022 under inflation adjustments announced by the agency on Tuesday.” Meanwhile, “the standard deduction [for all] will climb to $27,700 for married couples and $13,850 for individuals, both also up about 7% from this year, letting taxpayers shield more of their earnings from income taxes.”

The sizable adjustments will take effect for the 2023 tax year & will likely be reflected in the withholding on payroll checks starting in January. They are “unusually” high, of course, because inflation has been unusually high and thanks to Congress indexing “core features” of the tax system to inflation in 1985. One problem with the indexing for the nation at this time is that will likely add even more to its $31.1 trillion debt just announced by the Treasury Dept … and, therefore, likely help further fuel INFLATION.

Davd Soul