Taxes are a moving target because many dollar limits and percentages change annually due to increases in inflation. However, some limits and amounts are fixed in the Tax Code and cannot be changed without an act of Congress. Still others are set by the IRS for administrative convenience and are not adjusted annually but could change at the IRS's whim. To help you plan ahead and to figure estimated taxes for 2023, where necessary, lists of items that may or may not change for the next tax year follow. The adjustments for 2023 are listed in the Supplement to the extent that these are available in February 2023.

Items Adjusted Annually for Inflation

• 401(k) plans—the annual contribution limit through salary reductions as well as the additional contribution limit for those age 50 and older by year end.
• Adoption assistance—excludable employer‐provided adoption assistance for employees ($14,890 for 2022).
• Archer medical savings accounts (MSAs)—the dollar limit on contributions for plans established before 2008.
• Energy‐efficient commercial buildings—the dollar amount per square foot that can be deducted. For 2022, this is $1.88 per square foot (or 63¢ per square foot where applicable). Note: After 2022, different amounts (not these amounts adjusted for inflation) determine the deduction for energy‐efficient commercial buildings.
• Excepted benefit health reimbursement accounts—the dollar limit, initially fixed at $1,800, is unchanged for 2022.
• First‐year expensing (Sec. 179 deduction)—the dollar limit on the deduction, as well as the phase‐out on property placed in service. For 2022, the limits are $1,080,000 and $2,700,000, respectively.
• Foreign earned income exclusion—the amount of wages or self‐employment income earned abroad eligible for the exclusion is limited ($112,000 in 2022).
• Health savings accounts (HSAs)—the dollar limit on contributions as well as the definition of a high‐deductible health plan (HDHP).
• IRAs and Roth IRAs—the contribution limits as well as the income limits on making contributions in certain situations.
• Medical flexible spending accounts (FSAs)—the most that employees can add annually on a pretax basis is capped at $2,850 for 2022. The permissible carryover if the plan allows it is $570 for 2022 (or all unused amounts if the plan allows it).
• Penalties—the amount imposed for late filing, underpayments, or other failures to comply with the tax law.
• Per diem rates for travel costs—the special transportation industry meals and incidental expenses, incidental expenses only, and the high cost localities for purposes of the high‐low substantiation method.
• Qualified small employer health reimbursement arrangements (QSEHRAs)—the maximum annual reimbursement to employees for self‐only or family coverage in 2022 is $5,450 and $11,050, respectively.
• Retirement plan contributions and benefits—the limits on making tax‐advantaged contributions to qualified retirement plans.
• Shared responsibility payment—there is no penalty if the cost of employer health coverage is deemed to be affordable, which, in 2022, is 9.61% of household income.
• Small employer health insurance credit—the amount of average compensation, originally fixed at $25,000, is $28,700 for 2022.
• Social Security wage base—the amount that is used to figure the Social Security portion of FICA and self‐employment tax ($147,000 for 2022).
• Tax brackets for individuals—the amount of taxable income within each bracket may be increased annually; this impacts sole proprietors and owners of pass‐through entities.
• Transportation fringe benefits—the amount excludable for free parking, and the aggregate amount excludable for transit passes or van pooling, is $280 per month in 2022.

Items Fixed by the Tax Code

• Additional Medicare tax on earned income—the threshold above which earned income is subject to this 0.9% tax is fixed according to filing status; the threshold does not change annually.
• Cruise ship travel—the cost of business meetings held on cruise ships is deductible up to $2,000 if certain requirements are met.
• Dependent care assistance—employer‐paid dependent care assistance is excludable up to $5,000 annually.
• Disabled access credit—the maximum amount of expenses that can be taken into account in figuring the credit is between $250 and $10,250.
• Education assistance—employer‐paid education assistance for employees is capped at $5,250.
• Gifts—the deduction for business gifts is limited to $25 (exclusive of shipping).
• Group term life insurance—the tax‐free portion is coverage up to $50,000.
• Net investment income tax—the 3.8% net investment income (NII) tax depends on modified adjusted gross income over a threshold amount that varies with filing status but the threshold does not change annually.
• Prizes and awards to employees—the maximum deduction for nonqualified award to any one employee is capped at $400 per year. Total awards (qualified and nonqualified) to any one employee is limited to $1,600 per year.
• Reforestation expenses—up to $5,000 ($10,000 if married filing jointly) can be expensed.
• Start‐up costs—up to $5,000 can be deducted in the first year of business.

Items Set by the IRS

• Annual reporting by retirement plans—one‐participant plans are exempt from reporting if plan assets at the end of the year do not exceed $250,000 (and this is not the final year of the plan).
• Below market loans—low‐ and no‐interest loans can trigger taxable income to the lender; the interest rate for determining whether a loan is below the market rate is fixed by the IRS. An annual blended rate applies for below market loans outstanding for the full year (e.g., 1.4% for 2022).
• Building improvements—under a safe harbor method for small taxpayers, they can be capitalized if they do not exceed the lesser of $10,000 or 2% of the unadjusted basis of the building as long as the building's unadjusted basis is no more than $1 million.
• Dollar limits on depreciating vehicles under 6,000 pounds—the amount of depreciation each year that the vehicle is owned is capped (the year in which the vehicle is placed in service affects the applicable cap for the remainder of the period of ownership).
• Deemed depreciation for business vehicles—if expenses for business use of a personal vehicle owned by the taxpayer is figured using the IRS's standard mileage allowance, then the basis of the vehicle is reduced by a set amount per mile (e.g., 26¢ per mile in 2022).
• De mimimis rule for deducting the cost of certain property—instead of depreciating the cost, the property may be treated as nonincidental materials and supplies up to $2,500 per item or invoice ($5,000 applies only for businesses with audited financial statements).
• Home office deduction—under the simplified method, the deduction is figured at $5 per square foot up to 300 square feet of space.
• Inclusion amount—the amount of income taken into account for business use of a vehicle that is leased.
• Mileage allowance—the rate per mile used to determine the deduction for business use of a personal vehicle instead of deducting the actual costs (58.5¢ per mile for the first half of 2022 and 62.5¢ per mile for the second half of 2022).
• Per diem travel rates—the IRS sets the rate for a daily deduction covering lodging, meals, and incidental expenses for travel to high‐cost areas and all other areas within the continental U.S. The General Services Administration also has per diem rates.
• Travel costs—no receipt is required for the cost of travel expenses under $75. However, a receipt is required for lodging costs, regardless of amount.