Dufour Tax Group, LLC

Dufour Tax Group LLC specializes in providing comprehensive strategic tax planning and compliance services to individuals and businesses across the globe. With a broad set of in-house skills and experience, we have the flexibility to work with a multitude of clients – from startups to multimillion

215 Commercial Street Portland, ME, 04101 United States

Dufour Tax Group LLC specializes in providing comprehensive strategic tax planning and compliance services to individuals and business across the globe.

With a broad set of in-house skills and experience, we have the flexibility to work with a multitude of clients - from startups to multi-million dollar enterprise-level companies.

What's New for 2022?

December 01, 2022  /  Kelly Dufour

Back in 2021 the IRS announced their annual changes for the 2022 tax year, to be filed in 2023. Although this is done on a yearly basis to account for inflation and the economy, this current tax year will produce some unique developments. Following the surge in inflation over the last couple of years, changes were made with the intent of covering the shifting value of the dollar. Beginning with the income tax brackets, 2022 will implement the following changes: CLICK HERE TO VIEW.

While there are not any changes to the rates themselves, the values within each bracket are updated. These adjustments are most substantial for couples filing together and heads of household, with an average increase to each bracket cap at nearly 10% when compared to 2021. Although less significant of a difference, single returns will see a roughly 3% change next year to these values. This will come as welcome news to those submitting returns with their spouse or maintaining a household struggling to cope with the various increases in cost of living, since they will pay a lower percentage of tax on income as they otherwise would under normal smaller alterations. Barring a measurable increase in income for either married filing joint or head of household, many taxpayers under these conditions with static income will see a slight reduction in their liability over the prior year. For those claiming the standard deduction, there will be a slight increase regardless of filing status of around 3%. New rates for this deduction are as follows for 2022: $25,900 for married filing joint, $12,950 for single returns or married filing separately, and $19,400 for head of household. In 2021 they were valued at: $25,900, $12,550, and $18,800 respectively.

Additionally, there will be an increase in the Earned Income tax credit, for those who qualify with three or more children, up to $6,935 from $6,728. This too is in line with the IRS’ attempt to provide some relief to those caring for a family during these uncertain economic times. Taxpayers will also see an increase in savings limits for their 2022 returns, up to $1,000 for 401(k) retirement accounts, and maximum limits of $7,400 and $4,950 for Health Savings Accounts (HSA’s).

Some other key changes to the 2022 tax year are as follows. Unlike 2021, taxpayers will no longer be allowed to deduct either $300 or $600 (single or joint) of charitable contributions without incorporating itemized deductions. This was only implemented for the single year as an incentive for people to donate towards their local communities or additional charities providing aid. There also will not be any additional federal recovery rebate credits sent out to taxpayers to report for the year. Finally, the maximum Child and Dependent Care credit has dropped to 35% of expenses instead of the 50% from 2021. Taxpayers may claim up to $3,000 of expenses for one child under the age of 13 or $6,000 for two or more under the same age.