With the 2022 tax season coming to a close, we always like to take this opportunity to highlight any new contribution limits for a variety of retirement and other investment accounts that may be taking effect in the new tax year.
For 2023, new contribution limits include:
- 401(k) / 403(b) – $22,500 + additional $7,500 if over age 50
- IRA / Roth IRA – $6,500 + $1,000 if over age 50
- SIMPLE IRAs – $15,500 + $3,500 if over age 50
- Health Savings Account (HSA): Individual Health Insurance Plan – $3,850 + $1,000 if over age 55; Family Health Insurance Plan – $7,750 + $1,000 if over age 55
Beyond these updated limits, other notable changes / adjustments taking effect in 2023 include:
- The annual gift exclusion increased to $17,000 this year. This is the maximum amount that one individual can give another individual each year without filing a gift tax return.
- The maximum earnings subject to Social Security tax (6.2%) is $160,200.
- The base monthly Medicare Part B premium actually decreased to $164.90. If income is above $97,000 for Single taxpayers or $194,000 for Married Filing Jointly taxpayers, an Income Related Monthly Adjustment Amount (IRMAA) is added to the base premium for Part B and Part D. There are ways to appeal the IRMAA if a life-changing event has occurred.
As always, reach out to your Galecki team members if you have any questions on any of these or other tax-related items for 2023.