Quote:
Originally Posted by Slowgowing
Hi -
I am constructing an Excel spreadsheet in order to estimate/guestimate future federal income taxes based on my estimated income.
As a starting point, I could use tax year 2022 brackets and the standard deduction amounts since they are known, and then adjust them by some amount or proportion for each year in the future. However, it’s not clear to me by what amount to adjust/increase them.
Clearly, this exercise is more guesswork than science because no one knows this information with certainty, but I’d like to implement something that’s seemingly reasonable.
I do understand that the current tax brackets are scheduled to revert in 2026 unless Congress makes a change – which of course, is certainly possible. Perhaps this is a foolhardy endeavor, but that’s never stopped me in the past.
So….I am seeking your guidance or suggestions. What have you done?
Thanks in advance for your thoughts and Happy New Year!
|
Use the RPM spreadsheet. It does exactly what you are looking for.
I coded my own version of tax brackets into my home grown retirement spreadsheet and I grow the standard deduction over time. It works well.
Income taxes are entirely forecastable using current rates. When/if rates change, change your model. You need to build sufficient fidelity into your model to account for your personal situation: types of income, deductions, etc. If TurboTax can do it so can you.