J.K. Lasser's Your Income Tax 2023, 2nd Edition

What's New for 2022

Some of the tax changes for 2022 noted below were provided by the Inflation Reduction Act, such as new rules for the credit for certain home energy improvements. For an update on tax developments and a free download of the e‐Supplement to this book, visit us online at jklasser.com.

Tax News for 2022

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Tax rate brackets and preferential rates for capital gains/qualified dividends

The rate brackets for 2022 ordinary income remain at 10%, 12%, 22%, 24%, 32%, 35% and 37%, but the taxable income amounts in each bracket have changed. The top bracket of 37% for 2022 applies if taxable income exceeds $539,900 for single taxpayers and heads of households, $647,850 for married persons filing jointly and qualifying widows/widowers, and $323,925 for married taxpayers filing separate returns (1.2). Qualified dividends (4.2) and long‐term capital gains (5.3) may escape tax entirely under the 0% rate, or be subject to capital gain rates of 15% or 20% depending on filing status, taxable income, and how much of the taxable income consists of qualified dividends and eligible long‐term gains (5.3). The 20% capital gain rate applies in 2022 when taxable income exceeds $459,750 for singles, $488,500 for heads of households, $517,200 for married persons filing jointly and qualifying widows/widowers, and $258,600 for married persons filing separately. The 0%, 15%, and 20% rates do not apply to long‐term gains subject to the 28% rate (collectibles and taxed ...