New National Laws Going Into Effect in 2023

The new year is almost here, and with it come new national laws. These include laws related to privacy, personal identification, and minimum wage.

All affected parties should take a look at the new legislation before they go into effect. Doing so will help them make a smooth transition into 2023. Keep reading to learn more about the new national laws going into effect in 2023.

Minimum Wage

One of the laws to look out for in 2023 has to do with the minimum wage. The federal rate for minimum wage remains unchanged at $7.25 per hour. However, multiple states are now coming up with new rates. Some of these rates are higher than the federal rate, which has remained constant for over a decade.

The changes in minimum wage will help ease inflationary pressures for people. Washington will have one of the highest minimum wage rates at $15.74 per hour in 2023. For some states, such as New York, the minimum wage will vary across industries and regions.

Remember that some of the changes in minimum wage rates don’t all take effect in January while others will kick in later in 2023. Employers must take time to understand any changes in minimum wage happening in their state. They must also prepare themselves to incorporate these new legislations in 2023. Failure to abide by the law may lead to hefty penalties and fines.

Privacy Laws

Currently, the United States lacks a national omnibus privacy law. So, some states are passing their own privacy laws to tackle how organizations process personal data. An omnibus law is a law that binds a wide range of organizations or people. It differs from a law that only covers a specific group or sector.

Some states with privacy legislation include California, Colorado, and Connecticut. Others are Utah and Virginia. Of all these states, California was the first to pass such a law. The legislation applies to businesses that meet certain criteria.

The California Privacy Rights Act and Virginia Consumer Data Protection Act will come into effect on January 1, 2023. The legislation in Colorado and Connecticut will go into effect on July 1, 2023. The Utah Consumer Privacy Act will be effective starting December 31, 2023.

Tax Laws

The United States uses a progressive tax system. That means income gets taxed at different rates rather than a flat rate. The rates differ for each tax bracket, ranging from 10% to 37%. Your taxable income determines the tax bracket you fall into.

The Internal Revenue Service (IRS) has made some changes to reflect inflationary pressure. There will be an increase in the income threshold for the different tax brackets. The changes will go into effect in the 2023 tax year. You may be wondering what the rise in income floors for tax brackets means for you.

You might end up paying less in taxes if your income remains constant between this year and the next. The IRS makes such changes every year to help with inflation. It aims to avoid a rise in taxable income when said income has a lower purchasing power.

Social Security

There will be some changes in social security in 2023. The average social security benefits awarded to retired persons are set to rise by $146. The increase in benefits will see retired workers get $1,827 monthly. The $146 rise is a product of cost-of-living adjustments.

A married couple where both parties get benefits will experience a rise in monthly payments. The rise may amount to approximately $238. The rise in social security payments in 2023 is equivalent to an 8.7% increase. That is a higher growth rate than the ones in 2021 and 2022. They were 1.3% and 5.9%, respectively.

There are more social security changes that will come into effect in 2023. These include:

A reduction in Medicare Part B premiums
An increase in the earnings subject to social security tax
The full retirement age is set at 67 for people born in 1960 or earlier

Looking ahead: Real ID

Originally, May 3, 2023, marked the enforcement date for REAL IDs. But on Dec. 5, 2022, DHS extended the deadline to 2025 for everyone aged 18 years and above to have REAL ID-compliant form of identification to fly within the country. A REAL ID is a driver’s license or identification card the federal government accepts as a form of identification.

The ID has a special seal. It shows that the cardholder meets specific standards set by the federal government. A state driver’s license without a REAL ID seal will no longer get accepted.

The REAL ID Act has been delayed multiple times. Implementation was initially supposed to happen in 2008. The REAL ID aims to ensure the consistency and security of identification documents.

Wrapping Up

A variety of new national laws will go into effect in 2023. Knowing what these legislations are will help you prepare accordingly to accommodate them.