In this portion of our 2023 Tax Planning series, we outline a few key broad items impacting individual filers. Please speak with a CPA for direct advice on your circumstances before filing.
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Changes in 2023
With inflation adjustments for more than 60 tax provisions, the IRS has made meaningful changes impacting 2023 tax returns. This includes changes to the standard deduction (up $1,800 for married couples, up $900 for single taxpayers and married individuals filing separately, up $1,400 for heads of households). We’ll look at these in greater detail in coming sections.
2023 Standard Deduction
| Single Filers | Joint Filers | Heads of Household | Married, Filing Separately |
| $13,850 | $27,700 | $20,800 | $13,850 |
| $14,600 | $29,900 | $21,900 | $14,600 |
If you are over 65 or blind, the standard deduction includes an additional $1,500 (if you are single or filing as head of household, the additional is $1,850).
2023 Individual Income Tax Brackets
| Rate | Single | Married, Filing Jointly | Head of Household | Married, Filing Separately |
| 10% | Up to $11,000 | Up to $22,000 | Up to $15,700 | Up to $11,000 |
| 12% | $11,001 to $44,725 | $22,001 to $89,450 | $15,701 to $59,850 | $11,001 to $44,725 |
| 22% | $44,726 to $95,375 | $89,451 to $190,750 | $59,851 to $95,350 | $44,726 to $95,375 |
| 24% | $95,376 to $182,100 | $190,751 to $364,200 | $95,351 to $182,100 | $95,376 to $182,100 |
| 32% | $182,101 to $231,250 | $364,201 to $462,500 | $182,101 to $231,250 | $182,101 to $231,250 |
| 35% | $231,251 to $578,125 | $462,501 to $693,750 | $231,251 to $578,100 | $231,251 to $346,875 |
| 37% | $578,126+ | $693,751+ | $578,101+ | $346,876+ |
2023 Dividend and Capital Gains Rates
| Qualified dividends and capital gains tax rate | Single filers | Joint Filers | Heads of Household | Married, Filing Separately |
| 0% | Up to $44,625 | Up to $89,250 | Up to $59,750 | Up to $44,625 |
| 15% | $44,626 to $492,300 | $89,251 to $553,850 | $59,751 to $523,050 | $44,626 to $276,900 |
| 20% | $492,301+ | $553,851+ | $523,051+ | $276,901+ |
2023 Earned Income Tax Credit
For qualifying taxpayers with three or more qualifying children, the maximum Earned Income Tax Credit for 2023 is $7,430 (up from $6,953 last year). Be mindful of income thresholds and phase-outs that impact your qualification.
Additional Credit Changes
Below you will find information on additional changes for 2023. Please speak with a CPA, as terms and qualifications apply to each of these. Remember, the best advice you can get is personal advice specific to your filing.
Energy-Efficient Home Improvement Credit
The Energy-Efficient Home Improvement Credit (formerly known as the Non-Business Energy Property Credit), has been extended through 2032.
Residential Clean Energy Credit
The Residential Clean Energy Credit (formerly known as the Residential Energy-Efficient Property Credit), has been extended through 2034.
Qualifying property for this credit includes, solar hot water, solar electric, fuel cell, small wind energy, geothermal heat pump, and biomass fuel.
Clean Vehicle Credit
The Clean Vehicle Credit (formerly known as the New Qualified Plug-In Electric Drive Motor Vehicle Credit), does not expire until 2032.
For vehicles put into service Jan 1, 2023 and later, this credit changes to $3,750 for meeting critical materials and critical battery component requirements. This is subject to income limits and price caps (not available for suggested retail pricing over $55,000 for cars or $80,000 for trucks, SUVs, and vans).
There are also important limitations to how and where the vehicle is manufactured, so check with a CPA before claiming.
