Episode 188: Could Inflation Lead to Higher Taxes?
David shares a stat from the US Labor Department: as of May 11th, inflation over the last 12 months through April of 2022 has been 8.3%. David explains that the general belief is that inflation doesn’t necessarily translate to more taxes because the IRS has been historically good at indexing tax brackets to keep up with inflation. However, he says, there are a few thresholds in the IRS tax code that aren’t indexed to keep up with inflation – and could result in you paying higher taxes. Social Security, for instance, counts as provisional income. This represents a problem because as your Social Security rises to keep up with inflation, you get pushed closer to the provisional income thresholds. This may not seem like a big deal if inflation increases at the historical rate of 3%, but initial projections show that, in 2023, Social Security could go up to 8%. Selling your primary residence is another area where inflation could cause you to pay more taxes. David explains that profits up t...
Ep 188: Could Inflation Lead to Higher Taxes?
June 8, 2022
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David shares a stat from the US Labor Department: as of May 11th, inflation over the last 12 months through April of 2022 has been 8.3%. David explains that the general belief is that inflation doesn’t necessarily translate to more taxes because the IRS has been historically good at indexing tax bra...
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