The tax rates remain the same for the sale of assets that grow in value, but the income thresholds will push higher
Newly announced inflation adjustments from the IRS will tweak the rules on capital gains taxes in 2024.
The tweaks are all part of the IRS’s annual update on more than 60 tax provisions that are pegged to rise with inflation rates. The adjustments are sizeable, with both income tax brackets and the standard deduction up by more than 5%.After 7% increases for tax year 2023, the newest IRS numbers reflect inflation’s slow retreat from four-decade highs.
The 15% tax rate applies to individuals with taxable income up to $518,900, which is up from $492,300. Read also: I’m getting $285,000 from my ex-spouse’s 401. I want to pay my children’s credit-card debt and student loans. Will I have to pay tax? What isn’t increasing For investors and home sellers, the annual adjustments are a stark reminder of the tax provisions that are not designed to rise with inflation.
Capital losses offset capital gains at tax time. When there are more losses than gains, people can deduct up to $3,000 in capital losses from their income. But the capital loss limitation has stayed at $3,000 for over four decades, meaning the tax code has been offering less cushion for soured investments through the years.
IRS Inflation Adjustments Capital Gains Taxes Tax Rates Investments Assets Income Thresholds Gift Tax Estate Tax
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