October 18, 2022 2023 Tax Brackets Alex Durante Alex Durante Download Data Print this page Download Data Subscribe Support our work See 2022 Tax Brackets On a yearly basis the Internal Revenue Service (IRS) adjusts more than 60 tax provisions for inflation to prevent what is called “bracket creep.” Bracket creep occurs when people are pushed into higher income tax brackets or have reduced value from credits and deductions due to inflation, instead of any increase in real income. The IRS used to use the Consumer Price Index (CPI) as a measure of inflation prior to 2018. However, with the Tax Cuts and Jobs Act of 2017 (TCJA), the IRS now uses the Chained Consumer Price Index (C-CPI) to adjust income thresholds, deduction amounts, and credit values accordingly. The new inflation adjustments are for tax year 2023, for which taxpayers will file tax returns in early 2024. Note that the Tax Foundation is a 501(c)(3) educational nonprofit and cannot answer specific questions about your tax situation or assist in the tax filing process. 2023 Tax Brackets and Rates In 2023, the income limits for all tax brackets and all filers will be adjusted for inflation and will be as follows (Table 1). There are seven federal income tax rates in 2023: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent, and 37 percent. The top marginal income tax rate of 37 percent will hit taxpayers with taxable income above $539,900 for single filers and above $693,750 for married couples filing jointly. 2023 Federal Income Tax Brackets and Rates for Single Filers, Married Couples Filing Jointly, and Heads of Households Tax Rate For Single Filers For Married Individuals Filing Joint Returns For Heads of Households 10% $0 to $11,000 $0 to $22,000 $0 to $15,700 12% $11,000 to $44,725 $22,000 to $89,450 $15,700 to $59,850 22% $44,725 to $95,375 $89,450 to $190,750 $59,850 to $95,350 24% $95,375 to $182,100 $190,750 to $364,200 $95,350 to $182,100 32% $182,100 to $231,250 $364,200 to $462,500 $182,100 to $231,250 35% $231,250 to $578,125 $462,500 to $693,750 $231,250 to $578,100 37% $578,125 or more $693,750 or more $578,100 or more Source: Internal Revenue Service Help Us Learn More About How Americans Understand Their Taxes Please take our quick, anonymous survey, conducted in partnership with the University of North Carolina Tax Center. Take Survey Standard Deduction and Personal Exemption The standard deduction will increase by $900 for single filers and by $1,800 for joint filers (Table 2). The personal exemption for 2023 remains at $0 (eliminating the personal exemption was part of the Tax Cuts and Jobs Act of 2017 (TCJA). 2023 Standard Deduction Filing Status Deduction Amount Single $13,850 Married Filing Jointly $27,700 Head of Household $20,800 Source: Internal Revenue Service. Alternative Minimum Tax (AMT) The Alternative Minimum Tax (AMT) was created in the 1960s to prevent high-income taxpayers from avoiding the individual income tax. This parallel tax income system requires high-income taxpayers to calculate their tax bill twice: once under the ordinary income tax system and again under the AMT. The taxpayer then needs to pay the higher of the two. The AMT uses an alternative definition of taxable income called Alternative Minimum Taxable Income (AMTI). To prevent low- and middle-income taxpayers from being subject to the AMT, taxpayers are allowed to exempt a significant amount of their income from AMTI. However, this exemption phases out for high-income taxpayers. The AMT is levied at two rates: 26 percent and 28 percent. The AMT exemption amount for 2023 is $81,300 for singles and $126,500 for married couples filing jointly (Table 3). 2023 Alternative Minimum Tax (AMT) Exemptions Filing Status Exemption Amount Unmarried Individuals $81,300 Married Filing Jointly $126,500 Source: Internal Revenue Source In 2023, the 28 percent AMT rate applies to excess AMTI of $220,700 for all taxpayers ($110,350 for married couples filing separate returns). AMT exemptions phase out at 25 cents per dollar earned once AMTI reaches $578,150 for single filers and $1,156,300 for married taxpayers filing jointly (Table 4). 2023 Alternative Minimum Tax (AMT) Exemption Phaseout Thresholds Filing Status Threshold Unmarried Individuals $578,150 Married Filing Jointly $1,156,300 Source: Internal Revenue Service. Earned Income Tax Credit (EITC) The maximum Earned Income Tax Credit (EITC) in 2023 for single and joint filers is $560 if the filer has no children (Table 5). The maximum credit is $3,995 for one child, $6,604 for two children, and $7,430 for three or more children. 2023 Earned Income Tax Credit (EITC) Parameters Filing Status No Children One Child Two Children Three or More Children Single or Head of Household Income at Max Credit $7,840 $11,750 $16,510 $16,510 Maximum Credit $600 $3,995 $6,604 $7,430 Phaseout Begins $9,800 $21,560 $21,560 $21,560 Phaseout Ends (Credit Equals Zero) 17,640 46,560 52,918 56,838 Married Filing Jointly Income at Max Credit $7,840 $11,750 $16,510 $16,510 Maximum Credit $600 $3,995 $6,604 $7,430 Phaseout Begins $16,370 $28,120 $28,120 $28,120 Phaseout Ends (Credit Equals Zero) 24,210 53,120 59,478 63,398 Source: Internal Revenue Service Child Tax Credit The maximum Child Tax Credit is $2,000 per qualifying child and is not adjusted for inflation. The refundable portion of the Child Tax Credit is adjusted for inflation and will increase from $1,500 to $1,600 for 2023. Capital Gains Tax Rates & Brackets (Long-term Capital Gains) Long-term capital gains are taxed use different brackets and rates than ordinary income (Table 6.) 2023 Capital Gains Tax Brackets For Unmarried Individuals, Taxable Income Over For Married Individuals Filing Joint Returns, Taxable Income Over For Heads of Households, Taxable Income Over 0% $0 $0 $0 15% $44,625 $89,250 $59,750 20% $492,300 $553,850 $523,050 Source: Internal Revenue Service Qualified Business Income Deduction (Sec. 199A) The Tax Cuts and Jobs Act of 2017 (TCJA) includes a 20 percent deduction for pass-through businesses. Limits on the deduction begin phasing in for taxpayers with income above $182,100 (or $364,200 for joint filers) in 2023 (Table 7). 2023 Qualified Business Income Deduction Thresholds Filing Status Threshold Unmarried Individuals $182,100 Married Filing Jointly $364,200 Source: Internal Revenue Service Annual Exclusion for Gifts In 2023, the first $17,000 of gifts to any person are excluded from tax, up from $16,000. The exclusion is increased to $175,000 from $164,000 for gifts to spouses who are not citizens of the United States. Related Resources 2022 Tax Brackets 2021 Tax Brackets Who Pays Federal Income Taxes? Social Security Cost-of-Living Adjustments Inflation Is Surging, So Are Federal Tax Collections Confused? Boost Your Tax Knowledge with TaxEDU Everyone can benefit from learning more about the taxes we pay and their impact on the world around us. Unfortunately, tax policy can be complex. Our goal is to make sure understanding it isn’t. Launch TaxEDU Banner image attribution: Leonid, Adobe Stock Topics Alternative Minimum Tax (AMT) Business Tax Expenditures, Credits, and Deductions Business Taxes Data Individual and Consumption Taxes Individual Capital Gains and Dividends Taxes Individual Income and Payroll Taxes Individual Tax Expenditures, Credits, and Deductions Small Business Taxes Tags Child Tax Credit (CTC) Earned Income Tax Credit (EITC) Inflation Inflation-Indexing Tax Cuts and Jobs Act (TCJA)