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Key Numbers for 2024

D Cator 2014
Donna L. Cator, CFP®, CDFA®
Vice President, Wealth Planning Advisor
[email protected]
(585) 419-0670 x50623

In order to ensure your financial plan meets your goals, it’s important to keep up to date with the latest federal numbers. For example, there are inflation adjustments, expiring tax breaks and changes to rules coming up in 2024 that could impact how much you can save, gift, deduct, etc. Taxpayers will need to be mindful, too, that numerous provisions from the Tax Cuts and Jobs Act are sunsetting at the end of 2025.

The big news for 2024 is the tax brackets and tax rates, which are shifting higher by 5.4%. This could provide the ability for Americans to increase their take-home pay and shield more of their income from the IRS.

2024 Standard Deduction

In 2024, the standard deduction will rise to $29,200 (up from $27,700 in 2023) for married filing jointly and for single payers it is $14,600 (up from $13,850 in 2023). Heads of households will see their standard deduction jump to $21,900 (up from $20,800).

Estate Tax

The estate, gift, and generation-skipping transfer (GST) exclusion for 2024 is $13,610,000 (up from $12,920,000 in 2023). These higher lifetime exemption amounts are due to “sunset” at the end of 2025, so you have less than two years to prepare.

Gift Tax

The annual gift exclusion is $18,000 for 2024. This is the amount you can give to another without reporting it on a gift tax return. Payments made directly for tuition and medical expenses are unlimited.

Employer Retirement Plan contribution limits

  • 401(k), 403(b), 457(b), Roth 401(k): $23,000 contribution limit plus catch up of $7,500 if 50 or older.
  • Simple plans: $16,000 contribution limit plus catch up of $3,500 if 50 or older

Individual Retirement Account contribution limits

  • Traditional nondeductible: $7,000 contribution limit plus catch up of $1,000 if 50 or older.
  • Traditional deductible (if covered by a plan): Same but there are income limits.
  • Roth: $7,000 contribution limit plus catch up of $1,000 if 50 or older.

Income limits for making deductible IRA contributions

  • Married filing jointly: $123,000-$143,000
  • Single or head of household: $77,000-$87,000
  • Married filing separately: $0-$10,000 and $230,000- $240,000 if one spouse is covered by a plan.

Income limits for making Roth IRA contributions

  • Married filing jointly: $230,000-$240,000
  • Single or head of household: $146,000-$161,000
  • Married filing separately: $0-$10,000
  • Roth conversion: No income limit

Tax-free IRA distributions to charity - Qualified Charitable Distributions (QCDs)

Taxpayers age 70½ or older can make tax-free distributions up to $105,000 from an IRA directly to charities in 2024 (up from $100,000). The distributions will decrease taxable income if included as a part of a Required Minimum Distribution (RMD) and, with limited exceptions, should be used by all those over 70 ½ who plan to make charitable contributions.

Health Savings Account contribution limits (for those enrolled in a high-deductible plan)

  • Individuals: $4,150 plus $1,000 catch up for 55 and older.
  • Families: $8,300 plus $1,000 catch up for 55 and older.

This is just a sample of the key numbers for 2024, there are many more not listed here. To make sure you are taking advantage of all the tools to assist in achieving your goals, schedule a meeting with one of our knowledgeable team members at CNB Wealth Management. We are always here to help and wish you all the best in 2024!

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