Nov. 14, 2023 - Epoch Times
10:44
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| Several days ago, right before the weekend, the IRS released a new statement, which actually contains some good news, given the fact that Americans will be saving hundreds or even potentially thousands of dollars on their taxes this upcoming year. | |
| Which is great, and it's just in time for the approaching Thanksgiving, which, for your reference, is said to be the most expensive meal in the history of the holiday. | |
| And that is, of course, on top of all the other inflation-related costs that Americans are shouldering. | |
| Regardless of that, though, let's break down exactly what the statement from the IRS actually said. | |
| To start with, as they do pretty much every single year, the IRS disclose their annual inflation adjustments. | |
| That's because as inflation increases and the value of the money in our pockets decreases, the IRS makes yearly adjustments to accommodate for that change. | |
| Quote, Potentially bringing a boost to your paycheck. | |
| And so, this year, the annual inflation adjustment, in total, it will affect over 60 different tax-related provisions, including the standard deduction. | |
| Now, the standard deduction is something that probably most people watching this video use. | |
| It's the deduction for people who don't itemize their taxes, and basically, in plain English, it's the amount of money that you can earn before you have to start handing money over to the government in the form of taxes. | |
| Last year, in 2023, the standard deduction for a married couple filing jointly was $27,700. | |
| That meant that the first $27,700 that you earned in a given year, you don't have to pay taxes on. | |
| Your taxes only start after that $27,700 mark. | |
| However, this upcoming year, the standard deduction has actually been increased. | |
| Under the IRS's newly announced annual inflation adjustments, the standard deduction for married couples filing jointly in 2024 is $29,200, up $1,500 or 5.4% from the prior year. | |
| For single taxpayers and married individuals filing separately, the standard deduction rises to $14,600 for 2024, up $750. | |
| For heads of households, the standard deduction will be $21,900 for the tax year 2024, up $1,100 from 2023, marking a 5.4% increase. | |
| Now, that one change by itself will save most taxpayers several hundred dollars. | |
| However, fortunately, it actually gets better with the introduction of several new changes to the tax bracket system. | |
| Now, to give you a bit of context here, the American tax system works on what's known as a step-up basis, with different marginal tax rates for different portions of your income. | |
| To explain it in simple terms, let's say that you are a married couple who earned $150,000 last year. | |
| Good for you. | |
| After applying all of your deductions, such as the standard deduction that we mentioned earlier, you're left with about $122,000 in taxable income, income that you have to pay taxes on. | |
| And so the way that the tax bracket system works is that you're going to pay different rates in terms of taxes on different portions of your money. | |
| And so this is what it looked like last year if you're married filing jointly. | |
| On the first $22,000 of your taxable income, you would pay 10% in taxes. | |
| Then, from $22,000 up until just over $89,000, you would pay 12% in taxes on that portion. | |
| And then, for anything over $89,450 up until $190,000, you would pay 22% in taxes on that portion. | |
| And so, in this specific example, this couple would pay, in total, about $17,500 in taxes in the year 2023. | |
| That is, of course, based on last year's brackets. | |
| And, of course, I should mention there are different brackets for different situations, such as married filing separately, heads of household, people who are single, and so on. | |
| All those numbers, by the way, up on your screen are from last year. | |
| However, this note is just released from the IRS, while the government has adjusted these tax brackets to accommodate the fact that inflation has, well, eaten away the purchasing power of our money. | |
| Quote, While the tax rates in percentage terms remain unchanged for the tax year 2024, the income limits at which they kick in have been changed. | |
| Overall, the income limits for these seven tax brackets have been raised by 5.4% for the 2024 tax year compared to the last year. | |
| And so let me show you what this change looks like in practice using that earlier example of a couple who filed their taxes, married filing jointly, and earned $150,000 in income. | |
| Next year, they'll be able to use that larger standard deduction, and so their taxable income is actually a little bit less. | |
| And then all of the income brackets that they fall into also get higher, with the end result being that this couple will pay about $16,682 in taxes, which, if you do the math, is effectively close to $1,000 less than last year. | |
| And then, just for your general reference, if you want to pause this video right now and screenshot these, up on your screen are all the income brackets for the different filing scenarios for the upcoming year. | |
| The ones you're seeing on screen right now are the ones that will be applicable next year in 2024. | |
| And then furthermore, outside of these tax brackets, the inflation adjustment has also had the effect of increasing the earned income tax credit. | |
| Quote, We're good to go. | |
| Now, it is worth mentioning here that the earned income tax credit, it actually differs based on the number of children that a couple has. | |
| But regardless, overall, it's received a 5% bump. | |
| And so these are the three main changes that the IRS has announced. | |
| A higher standard deduction, higher income tax bracket, as well as a larger earned income tax credit. | |
| Meaning, That you can save several hundred or perhaps even several thousand dollars, depending on how much you earn, which of course sounds great, until you consider the fact that, according to even the conservative estimates, the current rate of inflation is causing American families to spend about $700 more per month than they did two years ago. | |
| That means, if you do the math, that the average family will have spent about $8,000 more this year due to inflation than they did two years ago. | |
| But hey, at least we can all save several hundred bucks on our taxes. | |
| If you'd like to go deeper into the statement that the IRS put out, with just for reference, it contains a lot of other changes that we didn't mention, just because they're not so common. | |
| But if you want to go through the full list of changes, I'll throw the link to the IRS announcement and all the different changes. | |
| It'll be down in the description box below, which I should mention is that description box that's right below those like and subscribe buttons, both of which I hope you take a super quick moment to smash so that this information can reach ever more people via the YouTube algorithm. | |
| Now, speaking generally of money, let me quickly introduce today's sponsor by showing you this little piece of money. | |
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| Of course, all their details will be down in the description box below. | |
| And now, let's head on back to the studio. | |
| And then lastly, if you are enjoying this episode and you're thinking to yourself, man, I wish Roman would create a full-length documentary. | |
| Well... | |
| You're in luck, because I did. | |
| My team and I flew around the world in order to expose the devastating effects that the implementation of the United Nations Agenda 2030 is having on the world's farmers. | |
| Here's a trailer. | |
| Food prices are skyrocketing around the world. | |
| And if you listen to world leaders, they'll tell you it's due to climate change. | |
| Climate change is the biggest threat for the human beings. | |
| And their solution might surprise you. | |
| There are 1,900 edible insect species on the planet. | |
| The European Commission has officially declared mealworms to be food. | |
| Yes, this is due to our food. | |
| The people in charge have determined that by switching our diets to crickets, ants, and mealworms, we'll be able to stop temperatures from rising, lower the price of food, and possibly to even save the planet. | |
| It's never about innovation, it's always about getting rid of farmers. | |
| Agenda 21 was meant to be the agenda for the 21st century. | |
| Some of the goals sound nice, ending hunger. | |
| Who could possibly be against ending hunger? | |
| It requires total power from the state. | |
| I think it's a scam. | |
| A lot of this came about in the early 70s, the Clean Water Act, Clean Air Act, which were good things, but it's been abused from what the original intent is. | |
| No, maybe not this one. | |
| No, there's not a farm anymore. | |
| No, there's also not a farm anymore. | |
| So all these people shut down because of the government policies? | |
| Yeah. | |
| I'm the sixth generation of farmer. | |
| Yeah, I'm the fourth generation. | |
| How many years have they owned this plateau land? | |
| Forty years. | |
| I think we've lost the generation. | |
| They're shutting down the small and middle-sized family-run farms. | |
| We either own property or we are property. | |
| I don't think we can trust the government anymore because they want the land. | |
| And our founding fathers understood that the land would be distributed among the people so they could always control their government. | |
| Right now things have tripled as far as cost. | |
| I think you're going to see across the board higher food prices. | |
| Has anybody been held accountable for screwing up? | |
| No. | |
| As every communist tyrant in the last hundred years has understood, if you control the food, you control the people. | |
| Everything is falling apart. | |
| There's a shortage of food. | |
| We're heading for a world food crisis as we hear all the time. | |
| Do you see any hope for the situation? | |
| Yeah, we have to continue fighting for it. | |
| No farmers, no food. | |
| They will know it. | |
| If you'd like to check out that awesome documentary, you can find it over on Epic TV, our awesome no-censorship video platform. | |
| I'll throw the link to it. | |
| It'll be right there at the top of the description box below. | |
| And so if you're looking to spend some of that money you're about to save on taxes, well, you can click on that link, subscribe to the Epic Times, and check out not only that documentary, but a plethora of other great content down there. | |
| There's tons of documentaries. | |
| There's great shows. | |
| There's premium articles, infographics. | |
| There's tons of stuff over on the Epic Times website that will, well... | |
| Keep you occupied and keep you informed well into the coming year. | |
| I think you'll love it. | |
| The link, again, will be down there in the description box below. | |
| After you subscribe, you can just watch the documentary and you can cancel your subscription, but I'm sure that you won't. | |
| I'm sure that after you watch the documentary, you'll find a ton of other great content to love and you'll be a subscriber for a long, long, long time to come. | |
| Again, that link is right there at the top of the description box below. | |
| I hope you click on it and I hope that you join us over on the Epoch Times website. | |
| And then, until next time, I'm your host, Roman, from the Epoch Times. | |
| Stay informed. |
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