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In the U.S., the tax you pay is determined by which tax bracket you fall into based on your taxable income and filing status. In 2024 and 2025, the income tax rates for each of the seven brackets are the same: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37 percent.
But what changes every year, based on IRS inflation adjustments, is the income ranges for each of those brackets. For example, in 2024 a single filer will pay a 10% tax rate on income up to $11,600. In 2025, that bracket increases to $11,925. The reason for the increase each year is to avoid bracket creep, where people are pushed into higher tax brackets simply because of cost-of-living pay increases.
2024 tax brackets (for taxes due April 2025 or October 2025 with an extension)
| Tax rate | Single | Head of household | Married filing jointly or qualifying widow | Married filing separately |
|---|---|---|---|---|
| Source: IRS | ||||
| 10% | $0 to $11,600 | $0 to $16,550 | $0 to $23,200 | $0 to $11,600 |
| 12% | $11,601 to $47,150 | $16,551 to $63,100 | $23,201 to $94,300 | $11,601 to $47,150 |
| 22% | $47,151 to $100,525 | $63,101 to $100,500 | $94,301 to $201,050 | $47,151 to $100,525 |
| 24% | $100,526 to $191,950 | $100,501 to $191,950 | $201,051 to $383,900 | $100,526 to $191,950 |
| 32% | $191,951 to $243,725 | $191,951 to $243,700 | $383,901 to $487,450 | $191,951 to $243,725 |
| 35% | $243,726 to $609,350 | $243,701 to $609,350 | $487,451 to $731,200 | $243,726 to $365,600 |
| 37% | $609,351 or more | $609,351 or more | $731,201 or more | $365,601 or more |
2025 tax brackets (for taxes due April 2026 or October 2026 with an extension)
The IRS has announced new tax brackets for the 2025 tax year, for taxes you’ll file in April 2026 — or October 2026 if you file an extension. Brackets are adjusted each year for inflation.
For taxes due in 2026, Americans will see the same seven income tax brackets as last year: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37 percent.
| Tax rate | Single | Head of household | Married filing jointly or qualifying widow | Married filing separately |
|---|---|---|---|---|
| Source: IRS | ||||
| 10% | $0 to $11,925 | $0 to $17,000 | $0 to $23,850 | $0 to $11,925 |
| 12% | $11,926 to $48,475 | $17,001 to $64,850 | $23,851 to $96,950 | $11,926 to $48,475 |
| 22% | $48,476 to $103,350 | $64,851 to $103,350 | $96,951 to $206,700 | $48,476 to $103,350 |
| 24% | $103,351 to $197,300 | $103,351 to $197,300 | $206,701 to $394,600 | $103,351 to $197,300 |
| 32% | $197,301 to $250,525 | $197,301 to $250,500 | $394,601 to $501,050 | $197,301 to $250,525 |
| 35% | $250,526 to $626,350 | $250,501 to $626,350 | $501,051 to $751,600 | $250,526 to $375,800 |
| 37% | $626,351 or more | $626,351 or more | $751,601 or more | $375,801 or more |
Federal tax brackets: How they work and how to calculate your effective tax rate
Tax brackets are not as intuitive as they seem because most taxpayers have to look at more than one bracket to know their effective tax rate.
Instead of looking at what tax bracket you fall in based on your income, determine how many individual tax brackets you overlap based on your taxable income.
Figuring that out is easy in practice:
Example one:
Say you’re a single individual who earned $40,000 of taxable income in 2024. Technically, you’d be in the 12 percent tax bracket, but your income wouldn’t be levied a 12 percent rate across the board. Instead, you’d pay 10 percent on the first $11,600 of your income, plus 12 percent on the next chunk of your income between $11,600 and $47,150.(With taxable income of $40,000, you’d pay 12 percent on $28,399 of income, which is the amount of your income that falls into the 12 percent bracket.)
That often means Americans’ effective tax rate is lower than their highest tax bracket, also known as their marginal rate.
Example two:
Say you’re a single individual who earned $70,000 of taxable income in 2024. You would pay 10 percent on the first $11,600 of your earnings ($1,160); then 12 percent on the chunk of earnings from $11,601 to $47,150 ($4,266), then 22 percent on the remaining income ($5,027).Excluding any itemized or standard deduction, your total tax bill would be $10,453. Divide that by your earnings of $70,000 and you get an effective tax rate of 15 percent, which is lower than your 22 percent top, or marginal, tax bracket.
What is a marginal tax rate?
Another way of describing the U.S. tax system is by saying that most Americans are charged a marginal tax rate. That’s because as income rises, it’s taxed at a higher rate. In other words, the last dollar that an American earns is taxed more than the first dollar. This is what’s known as a progressive tax system.
The technical definition of a marginal tax rate would be the rate that each individual taxpayer pays on their additional dollars of income.
How to get into a lower tax bracket
Americans have two main ways to get into a lower tax bracket: tax credits and tax deductions.
Tax credits
Tax credits are a dollar-for-dollar reduction in your income tax bill. If you have a $2,000 tax bill but are eligible for $500 in tax credits, your bill drops to $1,500. Tax credits can save you more in taxes than deductions, and Americans can qualify for a variety of different credits.
The federal government gives tax credits for the cost of buying solar panels for your house and to offset the cost of adopting a child. Americans can also use education tax credits, tax credits for the cost of child care and dependent care and tax credits for having children, to name a few. Many states also offer tax credits.
Tax deductions
While tax credits reduce your actual tax bill, tax deductions reduce the amount of your income that is taxable. If you have enough deductions to exceed the standard deduction for your filing status (for single filers, the standard deduction is $14,600 in 2024 and $15,000 in 2025), you can itemize those expenses to lower your taxable income.
For example, if your medical expenses exceed 7.5 percent of your adjusted gross income in 2024, you can claim those and lower your taxable income.
Tax brackets from previous years:
Bankrate’s essential tax reading:
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