(TNS) — Plenty of people are trying to stick to their New Year’s resolutions, whether it be getting healthier, sticking with self care, or boosting one’s finances.
With regards to the latter, the United States federal government has some good news for you.
The Hill reports how many Americans may be pleasantly surprised when receiving their next paycheck, as it may show a higher amount.
This, writes The Hill, is the result of the IRS announcing inflation adjustments to the tax code back in November, adjustments which include changes to the standard deduction — which is a dollar amount that reduces the amount of income that’s taxable — and individual income brackets.
CNBC continues to report how this adjustment is about 5.4 percent higher for earning thresholds. Basically, adds CNET, if you fall into a lower tax bracket this year, your take-home may be higher.
It’ll also be noticeable to people whose wages are the same as last year, and depends on one’s withholding, states CNBC.
“While inflation is much less than it was a year ago, there is still pressure on wages,” told Tom McMullen, a senior client partner with consulting firm Korn Ferry, to CBS News in December.
And if you were wondering if getting a raise will affect your taxes, Investopedia says the answer is “Yes.”
“The more money you earn, the more taxes you will have to pay, increasing your tax bill,” explains Investopedia. “For example, if the income tax is 10% and you earn $5,000, your tax bill is $500. If you get a raise to $8,000, your tax bill is now $800.
“The U.S. income tax is progressive, so the more income you earn, the higher rate you will pay in taxes as you move from one income tax bracket to a higher one. But only the additional income that falls in the higher tax bracket is subject to the higher tax.”