Understanding the 2024 Tax Brackets and Inflation Adjustments

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What are the Differences Between the 2023 and 2024 Tax Brackets?
Tax season can be a daunting time, and navigating the ever-changing world of tax brackets and deductions can feel like deciphering an ancient code. For those filing their 2023 taxes this year (due April 15, 2024!), and planning for 2024 filings, understanding the adjustments made for inflation is crucial. So, take a deep breath, grab your coffee, and let’s explore the key differences between the 2023 and 2024 tax brackets.

Hold My Bracket: Tax Rates Remain the Same, But Thresholds Shift

First things first: the good news! The tax rates themselves haven’t changed for either 2023 or 2024. That means you’ll still see the familiar progression from 10% to 37% depending on your filing status and taxable income.

However, to account for recent high inflation and prevent “bracket creep” (paying a higher tax rate due to cost-of-living increases, not actual income growth), the bracket thresholds have been adjusted upwards for 2024. This means you’ll need to earn more money to fall into the same tax bracket as in 2023.

Breaking Down the Increases:

The table below illustrates the changes:

Filing Status	2023 Thresholds	2024 Thresholds	Increase
Single	$215,950 – $539,900	$231,700 – $563,050	$31,100
Married Filing Jointly	$539,900 – $647,850	$563,050 – $678,650	$15,600
Head of Household	$539,900 – $647,850	$563,050 – $678,650	$15,600
Married Filing Separately	$131,300 – $157,500	$137,050 – $160,750	$3,700
Single	$539,900 and above	$563,050 and above	$23,150
Married Filing Jointly	$647,850 and above	$678,650 and above	$30,800
Head of Household	$647,850 and above	$678,650 and above	$30,800
Married Filing Separately	$157,500 and above	$160,750 and above	$3,250

As you can see, the increases vary depending on your filing status, but generally range from $1,475 to $4,275. This means you could potentially fall into a lower tax bracket in 2024, even if your income increased slightly to keep up with inflation.

Beyond the Brackets: Other Adjustments to Know About

While the tax brackets are a major focus, keep in mind that other adjustments impact your overall tax liability:

Standard Deduction: The IRS also raised the standard deduction for 2024, which effectively reduces your taxable income. For single taxpayers and married filing separately, it increases to $14,600, while it climbs to $29,200 for married filing jointly and $21,900 for heads of household.
Other Tax Credits and Deductions: Be sure to explore other tax breaks that might apply to you, such as the Earned Income Tax Credit (EITC), Child Tax Credit, student loan interest deduction, and charitable contributions deduction. These can further lower your tax bill.

Consult a Tax Professional to Maximize Your Tax Benefits

Tax laws are continually evolving and can be complex. For many, if not most circumstances, seeking professional tax advice can ensure that you maximize your tax benefits, and navigate the intricacies of the tax code efficiently. For assistance with your tax planning, preparation and filing in Jacksonville, contact the professionals at Brock CPA by calling (904) 330-0268 or emailing dbrock@brockcpa.com. You can also information and resources on the IRS website: https://www.irs.gov/.

Budgeting Business

Top Financial Resolutions for 2024: A Guide for Families and Businesses

January 18, 2024 Beson

As we usher in a new year, it’s the perfect time to think about our financial goals and set actionable resolutions for a more secure and prosperous future. Whether you’re an individual or a business owner in Jacksonville, Florida, these practical financial resolutions can help you navigate the complexities of the fiscal landscape in 2024.

1. Streamline Your Budget for Increased Savings
Resolution: Revamp Your Personal and Business Budgets

Begin the year by reviewing your spending habits and identifying areas where you can cut unnecessary expenses. Allocate those savings towards an emergency fund or investment opportunities.

2. Optimize Tax Efficiency with Strategic Planning
Resolution: Implement Tax Planning Strategies

Stay ahead of the game by working with a CPA to develop a tax planning strategy tailored to your unique circumstances. Leverage Florida’s tax laws to minimize liabilities and maximize deductions for both personal and business taxes.

3. Diversify Your Investments for Long-Term Growth
Resolution: Review and Adjust Your Investment Portfolio

Ensure your investments align with your financial goals and risk tolerance. Diversify across different asset classes to spread risk and capitalize on potential growth opportunities.

4. Establish or Enhance Your Retirement Savings Plan
Resolution: Contribute to Retirement Accounts Regularly

Whether you’re an individual setting up an IRA or a business owner implementing a 401(k) plan, consistently contribute to retirement savings. Take advantage of tax benefits associated with retirement contributions.

5. Strengthen Emergency Funds for Financial Security
Resolution: Build or Reinforce Your Emergency Fund

Unexpected expenses can arise at any time. Aim to have at least three to six months’ worth of living or operating expenses in an accessible emergency fund.

6. Leverage Technology for Financial Organization
Resolution: Adopt Financial Management Tools

Explore digital tools and apps that can help you track spending, manage budgets, and streamline financial processes for your personal or business finances.

7. Assess and Enhance Your Insurance Coverage
Resolution: Review and Update Insurance Policies

Ensure your personal and business insurance policies adequately cover your current needs. Consider factors like life changes, new acquisitions, or changes in business operations.

8. Improve Credit Score and Credit Management
Resolution: Check and Manage Your Credit Regularly

Check your credit reports for inaccuracies, then monitor regularly and work on improving your credit score. A healthy credit score can lead to better financing opportunities and lower interest rates.

9. Enhance Business Efficiency through Technology
Resolution: Invest in Technology Upgrades

For business owners, consider investing in technology that can enhance efficiency and productivity. This might include upgrading software, implementing cloud solutions, or adopting automation tools.

10. Prioritize Professional Financial Guidance
Resolution: Engage with a Trusted CPA

Whether you’re an individual or a business owner, partnering with a certified public accountant can provide valuable insights and customized financial strategies to help you achieve your goals. Meet regularly with your CPA to ensure that you are doing everything you can to further your aims.

Setting realistic and achievable financial resolutions is a great first step toward a financially successful year. Tailor these suggestions to your specific circumstances and, when in doubt, call the professionals at Brock CPA to help you navigate the intricacies of Florida’s tax laws and your financial journey. Here’s to a prosperous 2024!

Accounting Business Taxes

The IRS Updates its “Where’s My Refund?” Online Tool

July 28, 2022 Beson

The Internal Revenue Service (IRS) has recently made improvements to its popular “Where’s My Refund?” tool, a feature that allows taxpayers to monitor their tax return status online.

This upgrade is especially crucial for those still waiting for their current tax returns, as well as those awaiting refunds from the previous two years due to the processing backlogs caused by the COVID-19 pandemic.

Taxpayers can now use the tool to check their refund status for any of the three most recent tax years, 2019, 2020, and 2021, by providing their Social Security number or ITIN, filing status, and the expected refund amount from their original tax return. The IRS has encouraged taxpayers to file their returns as soon as possible, and to take advantage of the updated online tool to check their refund status.

Business Taxes

Years of Neglect have Caused Chaotic Consequences for the IRS

May 16, 2022 Beson

In 2018, the U.S. Supreme Court ruled in South Dakota vs. Wayfair that states can require online businesses to collect sales taxes, even if they do not have a physical presence in the state. After nearly 3 years, Florida is finally about to do so.