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The IRS raised the top amounts of all seven federal income tax brackets for 2023, which could increase the paychecks of many employees by taxing more of their earnings at lower rates and influence employee decisions on paycheck withholding amounts.
By the start of the new year, U.S. employers should:
Adjust their payroll systems to account for the higher taxable wage base under the Social Security payroll tax.
Notify affected employees that more of their pay will be subject to payroll withholding.
Let the HCM Unlocked payroll experts help prepare you for these upcoming changes.