2024 Brings Inflation Adjustments for Taxpayers

2024 Brings Inflation Adjustments for Taxpayers

(RepublicanView.org) – The Internal Revenue Service announced its adjustments for inflation on November 9th for 2024.

One of its latest policies is to reinstate a previous rule called the Hazardous Substance Superfund. It will add a $0.26 tax to each barrel of oil received at refineries in the United States. It referred to the tax as a “Trust Fund” financing rate. Superfunds are typically allocated by the EPA in cleaning sites that have been contaminated by hazardous substances.

The agency is also raising several standard deduction rates. Married couples filing their taxes together will see their standard deductions rise to $29,900. Those filing separately will see it increase to $14,600. Head of household filers will see it rise to $21,900.

The yearly gift exclusion will be rising $1000 to $18,000. That provision excludes certain types of gifts from taxation. However, the amount that can be credited for adoption is increasing by $1,000 to $18,000.

Estates passed down to descendants will now have a basic exclusion up to $13,610,000. It was previously set to $12,920,000 in 2023.

There was also an increase in exclusions from foreign income. The new exclusion increased by $6,500 to $26,500.

Other rates remain unchanged. The 2024 personal exemption will stay at 0. There are also no limitations on itemized deductions. The marginal income tax rates will remain the same under normal circumstances. The lowest is set to 10%, while the highest remains at 37%.

The IRS also decided to waive $1 billion worth of fees related to penalties for failure to pay back taxes. Taxpayers owing less than $100,000 in back payments can qualify for the relief program. Officials said the fees were suspended in the ongoing aftermath of the government’s response to the 2020 health emergency. The turmoil caused a significant backlog at the agency.

The agency will still send collection notices for back and late payments. However, the measure may offer relief to many taxpayers, although it is a one-time deal.

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