Financial Safeguards Group

2022 Tax Year

Posted on: January 18 2022 / Written by: admin

Due to serious changes in Tax Law and preparation, we are recommending that as soon as possible clients contact us with year-to-date payroll information. With this information, we can run predictive calculations to ensure that the proper amount is being withheld to comply with new regulations. The withholding tables were released in February but other rules have changed that could adversely affect your taxable income.

Definitely Do Not Want to Discover in March or April of 2023 that you OWE the Internal Revenue Service money that you had not planned on.

2022 Tax Changes

The tax items for tax year 2022 of greatest interest to most taxpayers include the following dollar amounts:

The standard deduction for married couples filing jointly for tax year 2022 rises to $25,900 up $800 from the prior year. For single taxpayers and married individuals filing separately, the standard deduction rises to $12,950 for 2022, up $400, and for heads of households, the standard deduction will be $19,400 for tax year 2022, up $600.
The personal exemption for tax year 2022 remains at 0, as it was for 2021, this elimination of the personal exemption was a provision in the Tax Cuts and Jobs Act.

Tax Bracket Rates For tax year 2022 for individual single taxpayers with incomes greater than $539,900 ($647,850 for married couples filing jointly) 37%

The other rates are:
35%, for incomes over $215,950 ($431,900 for married couples filing jointly);
32% for incomes over $170,050 ($340,100 for married couples filing jointly);
24% for incomes over $89,075 ($178,150 for married couples filing jointly);
22% for incomes over $41,775 ($83,550 for married couples filing jointly);
12% for incomes over $10,275 ($20,550 for married couples filing jointly).
The lowest rate is 10% for incomes of single individuals with incomes of $10,275 or less ($20,550 for married couples filing jointly).

A w-9 box with boxes next to it that link to:

Charitable Donation Value guide

http://www.smbiz.com/sbrl007.html

Compute your Withholding

https://www.irs.gov/individuals/irs-withholding-calculator

Arizona Charitable Donation Tax Credits

https://azdor.gov/tax-credits/contributions-qualifying-charitable-organizations

Arizona Education Credits

https://azdor.gov/tax-credits/credits-contributions-certified-school-tuition-organizations

There is also a button that downloads a file for ‘Tax Preparation Organizer’.

If you donate cash, insure that the recipient is a 501(c) (3) organization. Not all are and you cannot deduct for ones that are not. Exceptions here are religious organizations. But you still need a receipt. Also, Look at all the Tax credits offered by Arizona. Private Tuition organizations, public schools, Working poor and others. Community Food bank, various rescue missions. there is certainly someplace to donate to that would be worthwhile and pay your Arizona Tax Bill. These credits have a varying amount of deductibility, from $400.00 to $2100.00.

Self-Employed?

Remember to save enough money to pay the self-employment tax of 15.3% on your net earnings. Nothing like getting slapped with a $15,000.00 to $25,000 tax bill in January. Create a log of daily mileage and expenses.

Print W-9 Forms and have everybody you pay money to fill out. You need this at end of the year to provide W-2 and 1099 forms.

Maintain separate accounts.. Business and personal. Easier to establish that you are a business…NOT A HOBBY

Financial Safeguards Group

2022 Tax Year

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2022 Tax Changes