2024 tax rate guide
By: The Wipfli Editorial Team
The IRS announced inflation-related adjustments to more than 60 tax provisions (Rev. Proc. 2023-2024) for tax year 2024. While many adjustments favor taxpayers, the ultimate tax impact will depend on your personal tax situation.
Make sure you understand how key changes could affect your overall tax liability.
2024 IRS tax brackets and rates
The IRS adjusts the tax brackets annually to help household incomes keep up with inflation. Because inflation rates were high throughout 2023, the IRS increased the income thresholds for the income marginal tax brackets by approximately 5.4%.
The top tax rate remains at 37% for individual taxpayers; however, the threshold for the top tax rate increases to incomes over $609,350 for individuals, $731,200 for married filing jointly and $365,600 for married filing separately. Below that, the tax rates range from 10% to 35%, depending on your taxable income.
Download Wipfli’s quick 2024 tax rate guide
2024 cost of living adjustments
In 2024, individuals who collect Social Security will see a 3.2% cost of living adjustment. The IRS also increased standard deductions, upped the mileage rate and raised the contribution limits for tax-deferred retirement plans and health flexible spending plans.
Gift, estate and trust taxes
A provision in the Tax Cuts and Jobs Act effectively doubled the basic exclusion amount a taxpayer may gift in their lifetime before the remainder is subject to estate taxes. The exclusion amount is annually indexed for inflation and, for 2024, is increased to $13,610,000. Under current tax law, starting in 2025, the exclusion amount returns to pre-2018 levels ($5 million, as adjusted for inflation).
Taxpayers who intend to make lifetime gifts to lower the value of their estate should start planning now to avoid future estate tax liabilities.
How Wipfli can help
Our tax specialists take a proactive and comprehensive approach to tax planning, so you can take advantage of every opportunity. Use our 2024 quick tax rate guide to stay up to date on key rates and deductions. Or contact us for support.
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