Tax Brackets & Rates

Tax Brackets & Rates

Each year, the Internal Revenue Service (IRS) adjusts various tax code provisions for inflation. These adjustments are designed to prevent “bracket creep,” a situation where taxpayers could move into higher tax brackets or see the real value of deductions and credits erode due solely to inflation rather than actual increases in income.

For tax year 2025, the IRS has announced several important inflation-related adjustments that will affect how taxable income is calculated and how certain credits, deductions, and exclusions apply. These updates are intended to keep the tax system aligned with rising costs of living.

The tax year 2025 adjustments outlined below generally apply to federal income tax returns that will be filed during the 2026 tax season.

  • Standard Deductions have increased across all filing statuses, including Single, Married Filing Jointly, Head of Household, and Married Filing Separately, allowing more income to be shielded from federal taxation.
  • Marginal Tax Rates remain unchanged, with the highest rate continuing at 37%; however, the income thresholds for each tax bracket have been adjusted upward to reflect inflation.
  • Alternative Minimum Tax (AMT) Exemptions have increased, along with higher income levels at which the exemption begins to phase out.
  • Earned Income Tax Credit (EITC) provides higher maximum credit amounts, particularly benefiting eligible taxpayers with three or more qualifying children.
  • Qualified Transportation Fringe Benefits and Health Flexible Spending Accounts (FSAs) have higher annual contribution limits for employees.
  • Medical Savings Accounts (MSAs) reflect updated limits for annual deductibles and maximum out-of-pocket expenses for both self-only and family coverage.
  • Foreign Earned Income Exclusion and Estate and Gift Tax exclusion amounts have increased to account for inflation.
  • Adoption Credit has increased, including a higher maximum credit amount for the adoption of a child with special needs.

Certain provisions remain unchanged for tax year 2025, including the elimination of personal exemptions, existing limitations on itemized deductions, and income thresholds related to the Lifetime Learning Credit.

Together, these inflation-related adjustments will play an important role in taxpayers’ planning, withholding decisions, and overall tax reporting strategies for the 2025 tax year.

Some taxpayers, however, may choose to itemize their deductions. This means subtracting certain eligible expenses and expenditures. Possible deductions include those for student loan interest payments, and contributions to an IRA. (Note: The deduction for moving expenses is now generally restricted only to members of the Armed Forces.) The most common itemized deductions also include:

Deduction for state and local taxes paid. Also known as the SALT deduction, the cap has been temporarily and significantly increased. It allows taxpayers to deduct up to $40,000 of any state and local property taxes plus either their state and local income taxes or sales taxes. (Note: This higher cap is subject to income phase-outs, and is set to revert to $10,000 in 2030.)

Deduction for mortgage interest paid. Interest paid on the mortgages for up to two homes can be subtracted. The debt limit is $750,000 for home acquisition debt incurred after December 15, 2017, which is now permanent. (The $1,000,000 limit only applies to debt incurred before this date.)

Deduction for charitable contributions.

Deduction for medical expenses that exceed 7.5% of AGI. (The income threshold is permanently set at 7.5% of AGI.)

New Deduction for Seniors (Age 65+): A temporary additional deduction of $6,000 is available per eligible senior (or $12,000 for a married couple where both qualify). (This deduction is phased out for taxpayers with Modified Adjusted Gross Income over $75,000/$150,000.)

New Deductions that Reduce AGI (Available even if you take the Standard Deduction):

New Vehicle Interest Deduction: A temporary deduction of up to $10,000 for interest paid on a loan for a qualified new vehicle for personal use.

Worker Income Deduction: Temporary deductions are available for qualified tips (up to $25,000) and qualified overtime compensation (up to $12,500, or $25,000 for joint filers).

Keep in mind that most taxpayers don’t itemize their deductions. If the standard deduction is larger than the sum of your itemized deductions (as it is for many taxpayers), you receive the standard deduction in addition to any New Deductions that Reduce AGI.

Once you have subtracted all eligible deductions from your adjusted gross income, you have your taxable income. If your taxable income is zero, that means you do not owe any income tax.

Future year Brackets & Rates

Previous years Standard Deductions

2024 Standard Deduction

  Filing Status Deduction Amount
Single $14,600
Head of Household (HOH) $21,900
Married Filing Jointly (MFJ) $29,200
Married Filing Separately (MFS) $14,600

2023 Standard Deduction

  Filing Status Deduction Amount
Single $13,850
Head of Household (HOH) $20,800
Married Filing Jointly (MFJ) $27,700
Married Filing Separately (MFS) $13,850

2022 Standard Deduction

  Filing Status Deduction Amount
Single $12,950
Head of Household (HOH) $19,400
Married Filing Jointly (MFJ) $25,900
Married Filing Separately (MFS) $12,950

Previous years Brackets & Rates

2024 Tax Brackets and Rates

  Rates  Single (Unmarried) Married Filed Jointly (MFJ) OR
Qualifying Widow		 Married Filed Separately (MFS) Head of Households (HOH)
10% Up to $11,600 $0 – $23,200 $0 – $11,600 $0 – $16,550
12% $11,601 – $47,150 $23,201 – $94,300 $11,601 – $47,150 $16,551 – $63,100
22% $47,151 – $100,525 $94,301 – $201,050 $47,151 – $100,525 $63,101 – $100,500
24% $100,526 – $191,950 $201,051 – $383,900 $100,526 to $191,950 $100,501 – $191,950
32% $191,951 – $243,725 $383,901 – $487,450 $191,951– $243,725 $191,951 – $243,700
35% $243,726 – $609,350 $487,451 – $731,200 $243,726 – $365,600 $243,701 – $609,350
37% $609,350 or more $731,200 or more $365,600 or more $609,350 or more

2023 Tax Brackets and Rates

  Rates  Single (Unmarried) Married Filed Jointly (MFJ) OR
Qualifying Widow		 Married Filed Separately (MFS) Head of Households (HOH)
10% Up to $11,000 $0 – $22,000 $0 – $11,000 $0 – $15,700
12% $11,001 – $44,725 $22,001 – $89,450 $11,001 – $44,725 $15,701 – $59,850
22% $44,726 – $95,375 $89,451 – $190,750 $44,726 – $95,375 $59,851 – $95,350
24% $95,376 – $182,100 $190,751 – $364,200 $95,376 to $182,100 $95,351 – $182,100
32% $182,101 – $231,250 $364,201 – $462,500 $182,101 – $231,250 $182,101 – $231,250
35% $231,251 – $578,125 $462,501 – $693,750 $231,251 – $34,6875 $231,251 – $578,100
37% $578,125 or more $693,750 or more $346,875 or more $578,100 or more

2022 Tax Brackets and Rates

  Rates  Single (Unmarried) Married Filed Jointly (MFJ) OR
Qualifying Widow		 Married Filed Separately (MFS) Head of Households (HOH)
10% Up to $10,275 $0 – $20,550 $0 – $10,275 $0 – $14,650
12% $10,276 – $41,775 $20,551 – $83,550 $10,276 – $41,775 $14,651 – $55,900
22% $41,776 – $89,075 $83,551 – $178,150 $41,776 – $89,075 $55,901 – $89,050
24% $89,076 – $170,050 $178,151 – $340,100 $89,076 to $170,050 $89,051 – $170,050
32% $170,051 – $215,950 $340,100 – $431,900 $170,051 – $215,950 $170,051 – $215,950
35% $215,951 – $539,900 $430,901 – $647,850 $215,951 – $323,925 $215,951 – $539,900
37% $539,901 or more $647,851 or more $323,926 or more $539,901 or more

2021 Tax Brackets and Rates

Rates  Single (Unmarried) Married Filed Jointly (MFJ) OR
Qualifying Widow		 Married Filed Separately (MFS) Head of Households (HOH)
10% Up to $9,950 Up to $19,900 $0 to $9,875 Up to $14,200
12% $9,951 to $40,525 $19,901 to $81,050 $9,876 to $40,125 $14,201 to $54,200
22% $40,526 to $86,375 $81,051 to $172,750 $40,126 to $85,525 $54,201 to $86,350
24% $86,376 to $164,925 $172,751 to $329,850 $85,526 to $163,300 $86,351 to $164,900
32% $164,926 to $209,425 $329,851 to $418,850 $163,301 to $207,350 $164,901 to $209,400
35% $209,426 to $523,600 $418,851 to $628,300 $207,351 to $311,025 $209,401 to $523,600
37% Over $523,600 Over $628,300 Over $311,026 Over $523,600
  Rates  Single (Unmarried) Married Filed Jointly (MFJ) OR
Qualifying Widow		 Married Filed Separately (MFS) Head of Households (HOH)
10% Up to $9,950 Up to $19,900 $0 to $9,875 Up to $14,200
12% $9,951 to $40,525 $19,901 to $81,050 $9,876 to $40,125 $14,201 to $54,200
22% $40,526 to $86,375 $81,051 to $172,750 $40,126 to $85,525 $54,201 to $86,350
24% $86,376 to $164,925 $172,751 to $329,850 $85,526 to $163,300 $86,351 to $164,900
32% $164,926 to $209,425 $329,851 to $418,850 $163,301 to $207,350 $164,901 to $209,400
35% $209,426 to $523,600 $418,851 to $628,300 $207,351 to $311,025 $209,401 to $523,600
37% Over $523,600 Over $628,300 Over $311,026 Over $523,600
  Rates  Single (Unmarried) Married Filed Jointly (MFJ) OR
Qualifying Widow		 Married Filed Separately (MFS) Head of Households (HOH)
10% Up to $9,950 Up to $19,900 $0 to $9,875 Up to $14,200
12% $9,951 to $40,525 $19,901 to $81,050 $9,876 to $40,125 $14,201 to $54,200
22% $40,526 to $86,375 $81,051 to $172,750 $40,126 to $85,525 $54,201 to $86,350
24% $86,376 to $164,925 $172,751 to $329,850 $85,526 to $163,300 $86,351 to $164,900
32% $164,926 to $209,425 $329,851 to $418,850 $163,301 to $207,350 $164,901 to $209,400
35% $209,426 to $523,600 $418,851 to $628,300 $207,351 to $311,025 $209,401 to $523,600
37% Over $523,600 Over $628,300 Over $311,026 Over $523,600