While these rates stay the same for 2025, the income thresholds for each bracket will adjust for inflation. However, significant changes loom ahead—the Tax Cuts and Jobs Act of 2017 is set to expire at the end of 2025, which could substantially impact future tax rates.
Remember, your 2024 tax return is due April 15, 2025, with extensions available until October 15, 2025. If you're struggling with tax debt, our best tax relief services can help you navigate your options. In this article, we'll explore the current 2024 federal income tax brackets, compare them to 2023's rates, and look at what's changing for 2025.
What Are Tax Brackets and Tax Rates?
Tax brackets are income ranges that determine how much tax you pay. Your tax rate is the percentage you pay on the income within each bracket. Both depend on your filing status and annual income.
Here's how it works: As a single filer in 2024, your income from $11,601 to $47,150 is taxed at 12%. This is called being in the "12% tax bracket." But you won't pay 12% on all your income—only on the dollars within that range. Lower amounts are taxed at lower rates, and higher amounts are taxed at higher rates.
How Do Tax Brackets and Tax Rates Work?
The United States has a progressive tax system, which means tax rates increase as income rises. Tax brackets show exactly what rate applies to each level of income.
"A progressive tax system means the more money you make, the higher your last tax dollar falls into," says Andrew Van Alstyne, Enrolled Agent and financial advisor at Fiduciary Financial Advisors. "This ties directly into the marginal tax rate, which implies the sliding scale that a taxpayer 'progresses' up with more income. The effective tax rate is the average rate the taxpayer pays. The progressive/marginal system can be viewed as buckets filled up, only increasing to a higher percentage once the previous income bracket is filled."
For example, as a single filer in 2024, you'll pay:
10% on the first $11,600 of income
12% on income from $11,601 to $47,150
22% on income from $47,151 to $100,525
Important: Your tax bracket isn't your overall tax rate for the year—it's only the rate you pay on your highest income level. Most taxpayers have a lower "effective tax rate" (the average rate you actually pay) than their tax bracket suggests, since lower portions of income are taxed at lower rates.
2024 Tax Brackets and Income Rates
The 2024 tax brackets and income tax rates apply to income earned in 2024 and will be reported on your tax return filed in early 2025.
Income tax rate | Single filers | Married filing jointly | Married filing separately | Head of household |
---|---|---|---|---|
10% | $0 to $11,600 | $0 to $23,200 | $0 to $11,600 | $0 to $16,550 |
12% | $11,601 to $47,150 | $23,201 to $94,300 | $11,601 to $47,150 | $16,551 to $63,100 |
22% | $47,151 to $100,525 | $94,301 to $201,050 | $47,151 to $100,525 | $63,101 to $100,500 |
24% | $100,526 to $191,950 | $201,051 to $383,900 | $100,526 to $191,950 | $100,501 to $191,950 |
32% | $191,951 to $243,725 | $383,901 to $487,450 | $191,951 to $243,725 | $191,951 to $243,700 |
35% | $243,726 to $609,350 | $487,451 to $731,200 | $243,726 to $365,600 | $243,701 to $609,350 |
37% | $609,351 or more | $731,201 or more | $365,601 or more | $609,351 or more |
2023 Tax Brackets and Income Tax Rates
Tax returns for 2023 were due on April 18, 2024, for most filers. If you secured an extension by tax day, your new federal filing deadline was Oct. 16, 2024. Here are the tax rates and income brackets for 2023:
Income tax rate | Single filers | Married filing jointly | Head of household | Married filing separately |
---|---|---|---|---|
10% | $0 to $11,600 | $0 to $23,200 | $0 to $16,550 | $0 to $11,600 |
12% | $11,601 to $47,150 | $23,201 to $94,300 | $16,551 to $63,100 | $11,601 to $47,150 |
22% | $47,151 to $100,525 | $94,301 to $201,050 | $63,101 to $100,500 | $47,151 to $100,525 |
24% | $100,526 to $191,950 | $201,051 to $383,900 | $100,501 to $191,950 | $100,526 to $191,950 |
32% | $191,951 to $243,725 | $383,901 to $487,450 | $191,951 to $243,700 | $191,951 to $243,725 |
35% | $243,726 to $609,350 | $487,451 to $731,200 | $243,701 to $609,350 | $243,726 to $365,600 |
37% | $609,351 or more | $731,201 or more | $609,351 or more | $365,601 or more |
2025 Tax Brackets and Income Tax Rates
The IRS just announced the new tax brackets and rates for 2025. These income brackets were adjusted for inflation—so they are slightly higher than in 2024:
Income tax rate | Single filers | Married filing jointly | Head of household | Married filing separately |
---|---|---|---|---|
10% | $0 to $11,925 | $0 to $23,850 | $0 to $11,925 | $0 to $17,000 |
12% | $11,926 to $48,475 | $23,851 to $96,950 | $11,926 to $48,475 | $17,001 to $64,850 |
22% | $48,476 to $103,350 | $96,951 to $206,700 | $48,476 to $103,350 | $64,851 to $103,350 |
24% | $103,351 to $197,300 | $206,701 to $394,600 | $103,351 to $197,300 | $103,351 to $197,300 |
32% | $197,301 to $250,525 | $394,601 to $501,050 | $197,301 to $250,525 | $197,301 to $250,500 |
35% | $250,526 to $626,350 | $501,051 to $751,600 | $250,526 to $375,800 | $250,501 to $626,350 |
37% | $626,351 or more | $751,601 or more | $375,801 or more | $626,351 or more |
How to Reduce Taxes Owed
There are several proven strategies to reduce your tax bill, with tax deductions and tax credits being the main way to lower your taxes owed for the year. Here’s how they work:
Tax deductions: These lower your taxable income and may even drop you into a lower tax bracket. Some deductions can be taken yearly, and some only apply if you itemize your tax deductions. Common deductions include retirement account contributions, student loan interest, mortgage interest, and state taxes paid.
Tax credits: Tax credits directly reduce what you owe dollar-for-dollar, making them typically more valuable than deductions. Common tax credits include the child tax credit, earned income tax credit, and the American opportunity tax credit.
If you’re a small business owner, you can also lower your taxes owed by deducting business expenses or incorporating your business to lower your self-employment taxes owed.
Bottom Line
Your income and tax filing status determine your tax bracket and rate, but being in a higher bracket doesn't mean all your income is taxed at that rate. You'll pay different rates as your income moves through each bracket. While tax deductions and credits can help lower your bill, tax law can be complex.
Consider working with a licensed tax professional (like an Enrolled Agent or CPA) to avoid costly mistakes and maximize your savings. If you're facing tax challenges, our recommended tax relief service providers can help you explore your options and find the best path forward.