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1. Standard Deduction Increases

  • Single: $13,850 (up from $13,000 in 2023).

  • Married Filing Jointly: $27,700 (up from $27,000 in 2023).

  • Head of Household: $20,800 (up from $19,400 in 2023).

2. Tax Bracket Adjustments

  • The IRS adjusted tax brackets for inflation, with slightly higher thresholds for each bracket. This provides relief for taxpayers whose income has risen due to inflation.

RateSingleMarried Filing Jointly

 10%  $0–$11,000$0–$22,000

 12%  $11,001–$44,725$22,001–$89,450

 22%  $44,726–$95,375$89,451–$190,750

 24%  $95,376–$182,100$190,751–$364,200

 32%  $182,101–$231,250$364,201–$462,500

 35%  $231,251–$578,125$462,501–$693,750

 37%Over $578,125Over $693,750

3. Contribution Limits

  • 401(k): Increased to $23,000, with a $7,500 catch-up for those aged 50+.

  • IRA: $6,500 contribution limit; $1,000 catch-up remains unchanged.

  • HSA: $4,150 (individual); $8,300 (family).

4. Child Tax Credit

  • Up to $2,000 per qualifying child under 17.

  • Refundable up to $1,600 per child for eligible low-income families.

5. Clean Vehicle Tax Credits

  • New clean vehicle credit of up to $7,500 applies to certain electric or plug-in hybrid vehicles.

  • Used EVs also qualify for a credit of up to $4,000, depending on vehicle price and taxpayer income limits.

6. Energy-Efficiency Credits

  • Taxpayers can claim up to 30% of qualified energy-efficient home improvements (maximum $1,200 annually).

  • Upgraded heat pumps and solar installations may qualify for additional credits.

7. Expanded ACA Premium Tax Credits

  • The expanded premium subsidies for marketplace health insurance plans have been extended through 2025 under the Inflation Reduction Act.

8. Estate and Gift Tax Exemption

  • The lifetime exemption is now $13.92 million per individual (up from $12.92 million).

9. Cryptocurrency Reporting

  • New requirements for brokers to issue Form 1099-DA for cryptocurrency transactions to improve reporting and compliance.

10. Corporate and Business Tax Updates

  • The Section 179 expensing limit increases to $1.19 million for 2024.

  • Phase-out threshold begins at $2.38 million.

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