As inflation continues to rise, the IRS announced higher federal income tax brackets and standard deductions for 2023.
For tax year 2023, the marginal tax rates are:
(A taxpayer's average tax rate or effective tax rate is the share of income paid in taxes. The marginal tax rate is the amount of additional tax incurred for added levels of income.)
The standard deduction is increasing to $13,850 for single taxpayers (up $900 from 2022) and $27,700 for married couples filing jointly (an increase of $1,800 from 2022).
Some changes also apply to the alternative minimum tax, estate tax exemption, earned income tax credit, and flexible spending account limits, among others. Visit the IRS website for details.
Effective date: October 18, 2022