tax year 2023

As a business owner, it is important to stay up to date on the latest ballot measures that could affect your taxes. Keeping informed of these measures can help you better prepare for future tax changes and maintain a healthy financial plan. Recent ballot measures that may affect business taxes have been proposed in various states across the country, so it is important to understand what might be in store for your business. Big Changes to Federal Business Income Taxes Some of the largest ballot measures and legislative changes that may affect business taxes stem from the 2022 Inflation Reduction Act (IRA) and the expiration of certain provisions in the 2017 Tax Cuts & Jobs Act (TCJA). The TCJA also allowed for full capital expensing for businesses from 2017 to 2022. On January 1st, 2023, that deduction was decreased by 20% and will continue to decrease gradually until 2027. Income tax brackets have been adjusted for inflation for the tax year 2023. For more information, check out our recent article on the topic. These changes are placing heavier burdens on businesses in the 2023 tax year. But, many state-level initiatives are being implemented as well. These things will aim to even things out and help businesses counteract their heavier federal tax responsibilities. State Changes That May Affect Business Taxes Before we start here, we want to make it clear that this article is not an exhaustive list of every state’s tax code changes for 2023, and we also want to remind taxpayers that there are likely to be more changes to your state’s tax code before the year is up. It’s important to stay up to date on current tax initiatives and legislation. You can do this by regularly checking the IRS website and your state government websites, or you can reach out to a trusted tax professional throughout the year. With that said, here are some of the biggest tax changes we’ve found that will affect certain states and businesses within them in …

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As of late 2022, annual inflation was over 8%, and consumer prices are up more than 9%. Let’s break down how inflation adjustments will affect our 2023 tax brackets. Inflation on the Rise – IRS Response We previously talked about the effects of inflation on business and tax trends earlier this year. And now the IRS is addressing these issues in an adjustment plan that affects more than 60 tax provisions. They recently shared a 28-page document outlining all of the provisions and changes, but we wanted to share some of the highlights with you here as well. The procedures in this provision went into effect on October 18, 2022, and will likely affect many taxpayers’ filings in the 2023 tax season. If you or your employees have salaries that did not keep up with the crazy inflation hikes this year, tax savings could be in your future for the 2022 tax year when it comes time to file your returns. The inflation adjustments are coming from the fact that prices haven’t increased this drastically for more than 40 years! With the price of everything – gas, groceries, homes, and everything in between – going up so quickly, the IRS has made inflation adjustments to the 2023 tax brackets. But what does that mean for you, the taxpayer? Let’s talk about it. 2023 Tax Brackets with New Inflation Adjustments The IRS makes inflation adjustments every year, but this year the adjustments were much more substantial. Some increases range from $400 to $1,000 depending on how the taxpayer files (married jointly, head of household, etc.). And tax year 2023 withholding rates have also been adjusted, which means employees will see slightly larger paychecks even without having received a raise for the year. For the tax year 2023, the standard deduction for those who file as married, filing jointly will increase to $27,700. This is a $1,800 increase from the previous year. For those filing single or married filing separately, the standard deduction will be $13,850 (a $900 …

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tax year 2023

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