Choose how you want to be taxed with advanced financial plans
2022 Tax Update
Tax rates change annually. These are the updates for 2022.
2022 income tax brackets
For unmarried individuals, taxable income over….
$1
10%
$10,275
12%
$41,775
22%
$89,075
24%
$170,050
32%
$215,950
35%
$539,900
37%
For married individuals filing joint returns, taxable income over…
$1
10%
$20,550
12%
$83,550
22%
$178,150
24%
$340,100
32%
$431,900
35%
$647,850
37%
For heads of households, taxable income over…
$1
10%
$14,650
12%
$55,900
22%
$89,050
24%
$170,000
32%
$215,950
35%
$539,900
37%
2022 Long-term capital gains rates
For unmarried individuals, taxable income over…
$1
0%
$41,675
15%
$200,000
18.8%*
$459,750
23.8%*
*Includes 3.8% net investment income tax
For married individuals filing joint returns, taxable income over…
$1
0%
$83,350
15%
$250,000
18.8%*
$517,200
23.8%*
*Includes 3.8% net investment income tax
For heads of household, taxable income over…
$1
0%
$55,800
%15
$200,000
18.8%*
$488,500
23.8%*
*Includes 3.8% net investment income tax
2022 IRA contribution limits
Under age 50
$6,000
Age 50 or over
$7,000
Traditional and Roth IRA contribution limits
Depending upon whether or not you and your spouse have a retirement plan at work, your IRA contribution may not be tax deductible and a Roth contribution might not be possible. See hereafter.
2022 Traditional IRA deductible contribution income limits
Covered by a plan at work…
Single or Head of Household…
….and your Modified AGI is…
…then you can take…
$68,000 or less
full deduction
in between
partial deduction
$78,000 or more
no deduction
Married filing jointly or qualifying widower…
…and your Modified AGI is…
…then you can take…
$109,000 or less
partial deduction
in between
partial deduction
$129,000 or more
no deduction
Follow this chart if you do have a retirement plan at work
Not covered by a plan at work…
Single, Head of Household or Qualifying Widower
Regardless of your income…
…you can take a full deduction
Married with a spouse who does not have a plan at work
Regardless of your income…
…you can take a full deduction
Married with a spouse who does have a plan at work …
…and your Modified AGI is…
…then you can take…
$204,000 or less
full deduction
in between
partial deduction
$214,000 or more
no deduction
Follow this chart if you don’t have a retirement plan at work
2022 Roth IRA contribution income limits
Roth IRA contributions, but not Roth conversions, are limited by income.
2020income
Single
Married Filing Jointly
May make a full Roth contribution
$129,000 or less
$204,000 or less
Contribution gradually reduced
in between
in between
Not eligible
$144,000 or more
$214,000 or more
Maximum income for Roth contributions
2022 SEP and Simple IRA contribution limits
SEP IRAs and Simple IRAs allow larger contributions than IRAs, but as discussed in the book, require rules to be followed.
SEP
$61,000
Simple
$14,000
The Simple IRA allows another $3,000 contribution if you are over age 50.
2022 401k contribution limits
Employee
$20,500
Max including employer
$61,000
If you are over age 50, add the “catch up” amount
$6,500
Highly-compensated employee, income above
$135,000
Over age 50? Max employer and employee is $64,500.
2022 estate tax exemption
Unmarried individuals
$12.06 million
Married couples
$24.12 million
These limits expire in 2025.
2022 Social Security and Medicare Taxes
These are also called FICA taxes, or payroll taxes.
Maximum earnings subject to Social Security Tax (OASDI):
$147,000
OASDI tax rate
12.4%
Max earnings subject to Medicare tax
no cap
Medicare tax rate
2.9%
Self-employed people pay all of it: 15.3%. Or, for employees, they pay half, employers pay half.
Medicare Surtax (IRMAA) in 2022
2020 modified adjusted gross income above….
Single
MFJ
MF Separate
2022 Part B Premium
Part D surtax
$1
$1
$1
$170.10
$0
$91,000
$182,000
$238.10
$12.40
$114,000
$228,000
$340.20
$32.10
$142,000
$284,000
$442.30
$51.70
$170,000
$340,000
$544.30
$71.30
$499,999
$749,999
$91,000
$578.30
$77.90
Income earned two years ago forces a monthly Medicare surtax for two years.
2022 HSA, HRA and FSA
Health savings accounts, health reimbursement accounts and flexible spending accounts; here are the contribution limits for 2021.