The IRS has increased the deduction for 2024 taxes — what that means for your tax refund
The IRS has raised the standard deduction for the 2024 tax year, helping taxpayers reduce taxable income and potentially get a bigger refund. With higher deductions for single, married and head of household, as well as adjusted tax brackets, these changes are intended to minimize the effects of inflation. Learn how these updates affect your tax return, strategies for maximizing deductions and how to track your refund for the 2025 tax season.
As the 2024 tax season approaches, it’s important to understand how recent changes made by the Internal Revenue Service (IRS) may affect your tax return. The IRS has announced an increase in the standard deduction and adjustments to tax brackets for the 2024 tax year, which are intended to take into account inflation and provide potential savings to taxpayers. The IRS has increased the deduction for 2024 taxes
IRS Raises Deductions for 2024 Taxes
The IRS’s adjustments to the standard deduction and tax brackets for the 2024 tax year are designed to provide taxpayers with greater relief amid inflation. By understanding these changes and how they apply to your financial situation, you can make informed decisions to maximize your tax benefits. Consider consulting a tax professional to effectively navigate these updates and ensure you are taking full advantage of available deductions and credits.
Effects on your tax refund
A higher standard deduction means more of your income is shielded from taxation, potentially leading to a larger tax refund or a lower tax bill. Here’s how it works:
Lower taxable income: With a higher deduction, your taxable income decreases. For example, if you’re a single filer earning $50,000 annually, the increased deduction reduces your taxable income from $36,150 in 2023 to $35,400 in 2024.
Tax bracket adjustments: The IRS has also adjusted tax brackets for inflation, which can further impact your tax liability. These changes ensure that cost-of-living increases don’t push taxpayers into higher tax brackets, a phenomenon known as “bracket creep.”
Potential for a bigger refund: With a lower taxable income and adjusted tax bracket, you may owe less tax, increasing the potential for a bigger refund when you file your 2024 tax return in 2025. The IRS has increased the deduction for 2024 taxes
| Change | 2023 Tax Year | 2024 Tax Year | Increase |
|---|---|---|---|
| Standard retrenchments for Single Filers | $13,850 | $14,600 | +$750 |
| Standard retrenchments for Married Filing Jointly | $27,700 | $29,200 | +$1,500 |
| Standard retrenchments for Heads of Household | $20,800 | $21,900 | +$1,100 |
As the 2024 tax season approaches, it’s important to understand how recent changes made by the Internal Revenue Service (IRS) may affect your tax return. The IRS has announced an increase in the standard deduction and adjustments to tax brackets for the 2024 tax year, which are intended to take into account inflation and provide potential savings to taxpayers. The IRS has increased the deduction for 2024 taxes