10 Jan 2023 Key Numbers-Business Planning
2023 and 2022 numbers for small business tax credit for providing health-care coverage, updated mileage rate, earnings subject to FICA taxes and more…
Adoption Assistance Programs
| Adoption assistance |
2022 |
2023 |
| Maximum amount that can be excluded from employee’s gross income |
$14,890 |
$15,590 |
| Phaseout threshold amount |
$223,410 |
$239,230 |
| Completed phaseout amount after |
$263,410 |
$279,230 |
Earnings subject to FICA taxes (taxable wage base)
| FICA tax |
2022 |
2023 |
| Maximum annual earnings subject to Social Security taxes |
$147,000 |
$160,200 |
| Social Security and Medicare combined tax rate |
15.30%1 |
15.30%1 |
| OASDI portion (Social Security) |
12.40% |
12.40% |
| Hospital Insurance portion (Medicare) |
2.90%1 |
2.90%1 |
1 An additional Medicare (HI) employee contribution rate of 0.9% (for a total employee contribution of 2.35%, and a total combined Medicare contribution rate of 3.8%) is assessed on wages exceeding $200,000 ($250,000 for married couples filing joint returns, $125,000 for married individuals filing separate returns). For married individuals filing joint returns, the additional 0.9% tax applies to the couples combined wages (to the extent the combined wages exceed $250,000).
Health insurance deduction for self-employed
| Health insurance premiums |
2022 |
2023 |
| Deduction for health insurance premiums paid by self-employed persons |
100% |
100% |
Qualified transportation fringe benefits
| Qualified transportation fringe benefits |
2022 |
2023 |
| Commuter vehicles and transit pass monthly exclusion amount |
$280 |
$300 |
| Qualified parking monthly exclusion amount |
$280 |
$300 |
| Qualified bicycle commuting reimbursement fringe benefit (monthly amount) |
N/A |
N/A |
Section 179 expensing
| Section 179 expensing |
2022 |
2023 |
| Maximum amount that may be deducted under IRC Section 179 |
$1,080,000 |
$1,160,000 |
| Deduction reduced by the amount by which the cost of §179 property placed in service during the year exceeds this amount |
$2,700,000 |
$2,890,000 |
Small business tax credit for providing health-care coverage
| Amount of credit |
2022 |
2023 |
| Maximum credit percentage |
50% |
50% |
| Partial credit |
2022 |
2023 |
| Number of full-time equivalent employees (FTEs) fewer than: |
25 |
25 |
| Maximum average annual wages less than: |
$57,400 |
$61,400 |
| Full credit |
2022 |
2023 |
| Number of full-time equivalent employees (FTEs) no more than: |
10 |
10 |
| Maximum average annual wages less than or equal to: |
$28,700 |
$30,700 |
Special additional first-year depreciation allowance
| Bonus depreciation |
2022 |
2023 |
| “Bonus” depreciation for qualified property acquired and placed in service during specified time periods |
100% |
80% |
Standard mileage rate (per mile)
| Business use of auto |
2022 |
2023 |
| Use of auto for business purposes |
$0.585 or $0.625* |
$0.655 |
|
*The IRS raised mileage rates for the final 6 months of 2022, so the higher rate noted above is effective as of July 1, 2022.
This information was developed by Broadridge, an independent third party. It is general in nature, is not a complete statement of all information necessary for making an investment decision and is not a recommendation or a solicitation to buy or sell any security. Investments and strategies mentioned may not be suitable for all investors. Past performance may not be indicative of future results.
Prepared by Broadridge Advisor Solutions Copyright 2023.
