11/28/2024
HEXA’S TAX
28679 Ryan Road, Warren, MI 48092
Phone: 313 985 4533
The U.S. tax code for 2024 includes several tax breaks and changes due to annual inflation adjustments. Here are the key highlights:
1. Standard Deduction Increase
The standard deduction is higher in 2024:
• Single filers: $14,600 (up from $13,850 in 2023)
• Married filing jointly: $29,200 (up from $27,700 in 2023)
• Head of household: $21,900 (up from $20,800 in 2023)
2. Tax Brackets
The tax brackets for 2024 are adjusted for inflation. For example:
• 10% bracket: Applies to income up to $11,000 (single) or $22,000 (married filing jointly)
• 37% bracket: Applies to income over $609,350 (single) or $731,800 (married filing jointly)
3. Earned Income Tax Credit (EITC)
The maximum EITC for 2024 is:
• Up to $7,620 for taxpayers with three or more qualifying children (up from $7,430 in 2023).
4. Child Tax Credit
The maximum credit remains $2,000 per child under age 17. For dependents over 17, a nonrefundable credit of $500 applies.
5. Retirement Savings Contributions
• 401(k) Contribution Limit: $23,000 (up from $22,500 in 2023)
• IRA Contribution Limit: $7,000 (up from $6,500 in 2023)
• Catch-up contributions for individuals age 50+ are increased to $7,750 for 401(k) plans and $1,750 for IRAs.
6. Flexible Spending Accounts (FSAs)
The maximum contribution for FSAs in 2024 is $3,200 (up from $3,050 in 2023).
7. Health Savings Accounts (HSAs)
HSA contribution limits for 2024 are:
• Self-only coverage: $4,150
• Family coverage: $8,300
• Catch-up contributions for individuals 55+: $1,000
8. Capital Gains Tax
Long-term capital gains rates remain at 0%, 15%, or 20%, depending on taxable income. The thresholds for these rates are adjusted for inflation.
9. Adoption Credit
The maximum adoption credit is $16,230 in 2024, up from $15,950 in 2023.
10. Energy Tax Credits
The Inflation Reduction Act continues to provide incentives for clean energy:
• Up to $3,200 for energy-efficient home improvements.
• Up to $7,500 for electric vehicles (subject to income and vehicle price limits).
11. Educator Expense Deduction
Teachers can deduct up to $350 for classroom supplies in 2024, or $700 for married educators filing jointly.