New tax laws impacting your 2023 taxes

AZ Big Media


2022 is in the rearview, which means that tax filing is on the horizon. Filing our taxes can seem overwhelming, so it’s easy to procrastinate. According to IPX 1031, Arizona ranks 12th when it comes to top procrastinators. By now, we should have a good handle on what to expect when filing our 2022 taxes, but with taxes on our minds, it’s a good time to understand the tax changes coming up in 2023. Below are a few changes to tax laws in 2023:

Flat Income Tax Rate For Arizonans

As of Jan. 1, 2023, Arizona will implement a new flat tax rate of 2.5 %. State tax rates in Arizona were previously tiered, ranging from 2.59-4.5% based on income. Now, everyone will pay 2.5% across the board. Arizona is among eleven other states with a flat income tax and will have the lowest tax rate in the country (other than the states with no income tax).

Increase In Tax Deductions

Tax deductions lower the amount of taxable income.Standard deductions for single filers are increasing from $12,950 in 2022 to $13,850 in 2023. Married couples filing jointly will go from $25,900 in 2022 to $27,700 in 2023, and married filing separately will go from $12,950 to $13,850. Another option is to itemize your deductions if you suspect it may add up to more than the standard deduction.

Increase In HSA And FSA Contributions