![]() ![]() Instead, you’ll pay taxes based on your adjusted gross income (AGI), or what you earned with tax deductions, credits, and adjustments. In fact, you’re unlikely to be taxed on the full amount you earned in 2022. But take note: your total wages and other income for 2022 are not the same as your taxable income. If you know your filing status and annual wage, you might think you know your tax bracket. Here are the long-term capital gains tax rates for tax year 2022, based on your taxable income and filing status: Short-term gains are levied on assets you’ve held for less than a year, and they are taxed at your regular marginal tax rate. Long-term gains are figured on assets you’ve held for more than a year and taxed at a favorable rate. There are long-term capital gains and short-term capital gains. Understanding capital gainsĬapital gains taxes are levied when you sell an asset, such as an investment, for more than you bought it for. For joint filers, the exemption starts at $118,100 and begins to phase out at $1,079,800. For single filers for 2022, the exemption starts at $75,900 and phases out at $539,900. If your minimum tax requirement is above your tax bill, you’re expected to pay the AMT. There is an exemption, however. This amount is called the tentative minimum tax. ![]() When calculating the AMT, you use a special form from the IRS to compare your current tax bill with what you’re supposed to pay at a minimum. The alternative minimum tax (AMT) is levied to ensure that certain taxpayers at least pay a minimum amount of tax, rather than avoiding individual income tax entirely. If you’re eligible for any tax credits, those would then be applied to reduce what you actually end up paying. Once you add up what you owe at each level, your total tax bill for 2022 would be $6,616.88.
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