Tax Changes and Key Amounts in 2024

Key Tax Amounts for 2024

Tax Brackets

Inflation during the 2023 fiscal year has widened the income tax brackets for individuals in 2024. However, the tax rates remain unchanged. To view the income tax brackets for both 2023 and 2024 tax years, visit the 2023 and 2024 Tax Brackets and Federal Income Tax Rates page.

Capital Gains and Qualified Dividends

The favorable tax rates on long-term capital gains and qualified dividends remain the same in 2024. However, the income thresholds to qualify for these rates have increased. The 0% tax rate applies to taxable incomes up to $94,050 for joint filers, $63,000 for heads of household, and $47,025 for single filers. The 20% tax rate starts at $583,751 for joint filers, $551,351 for heads of household, and $518,901 for single filers. Filers with taxable incomes between the 0% and 20% break point fall under the 15% tax rate.

Minimum Tax

In 2024, the AMT exemptions have risen to $133,300 for couples and $85,700 for singles and household heads. The exemption phaseout zones start at $1,218,700 for couples and $609,350 for others. The 28% AMT rate applies to taxable incomes above $232,600.

Kiddie Tax

In 2024, the kiddie tax has become less burdensome. The first $1,300 of unearned income for a child under age 19 (or under age 24 if a full-time student) is tax-free. The next $1,300 is taxed at the child’s rate, with any excess taxed at the parent’s rate.

Fringe Benefits

Employees covered by health flexible savings accounts can defer up to $3,200 in 2024. The maximum tax-free employer-provided parking cap for 2024 is $315 per month, matching the exclusion for mass transit passes and commuter vans. U.S. taxpayers working abroad can exclude up to $126,500 of their income in 2024, provided they meet all the eligibility requirements.

HSAs

For 2024, there are record-high HSA contribution limits:

• Individuals can contribute up to $4,150 to their HSA accounts.
• Families can contribute up to $8,300.

For more information about the 2024 medical savings account contribution limits, visit the FSA and HSA Contribution Limits for 2024 page.