Your federal taxes are calculated based on the tax brackets for your filing status. Each year, these brackets are adjusted for inflation. Here are the minimum income levels for the top tax brackets for each filing status in 2022:
Single: $539,901 (up from $523,601 in 2021)
Head of Household: $539,901 (up from $523,601 in 2021)
Married Filing Jointly: $647,851 (up from $628,301 in 2021)
Married Filing Separately: $332,926 (up from $314,151 in 2021)
Traditional IRA Income Restrictions To Deduct Contributions Rise
Contribution limits for IRAs remain unchanged at $6,000 if you are under 50 years old and $7,000 if you are 50 or older. However, the IRS did announce a few other tax changes that impact IRAs in 2022. First, if you are covered by an employer-sponsored plan, your income limit when you’ll still get a deduction for contributing increases.
Single Filers: The maximum deduction is reduced at $68,000 in 2022 (up from $66,000 in 2021) and is completely eliminated at $78,000 or more (up from $76,000).
Married Filing Jointly: The maximum deduction is reduced at $109,001 (up from $105,001 in 2021) and is completely eliminated at $129,000 (up from $125,000).
If your spouse is covered but you aren’t, your maximum deduction is reduced at $204,001 in 2022 (up from $198,000 in 2021) and is completely eliminated at $214,000 (up from $208,000).
Standard Deduction Rises for All Filing Statuses
All taxpayers are entitled to the standard deduction unless they choose to itemize their deductions. The 2022 standard deductions for all filing statuses are as follows:
Single: $12,950 (up from $12,550 in 2021)
Head of Household: $19,400 (up from $18,800)
Married Filing Jointly: $25,900 (up from $25,100)
Married Filing Separately: $12,950 (up from $12,550)