See the 2024 tax tables (for money you earned in 2024). Find the 2025 tax rates (for money you earn in 2025). See current federal tax brackets and rates based on your income and filing status.

Tax brackets determine the tax rate you pay on each portion of your income. The U.S. has a progressive income tax system, meaning higher incomes are taxed at higher rates. Your tax rate only applies to the income within that bracket, not your entire income. Your effective tax rate is the total tax liability divided by your taxable income. What tax bracket are you in, and what does that really mean? Your tax bracket, roughly speaking, is the tax rate you pay on your highest dollar of taxable income. It is not the tax rate you pay on all your income after adjustments, deductions, and exemptions. Your bracket only determines your individual income tax rates for each additional dollar of income (ignoring the effects of rounding). What tax bracket you fall in also depends on your filing status: single, married filing jointly, married filing separately, or head of household. We have federal tax brackets in the U.S. because we have a progressive income tax system. The progressive tax system ensures that all taxpayers pay the same rates on the same levels of taxable income. That means the higher your income level, the higher the tax rate you pay. Your tax bracket (and taxes you are responsible for) becomes progressively higher the more income you make. In a progressive tax system, tax rates are based on the concept that high-income taxpayers can afford to pay a higher tax rate. Low-income taxpayers pay fewer taxes overall and are taxed on a lower percentage of their income. Find your bracket in the following chart based on your filing status and 2023 income. $693,751 or more. Tax Tip: Still not sure which IRS tax bracket you are in? Estimate your tax rate with our tax bracket calculator or your income tax with our tax calculator. Example: How do tax brackets work? Let’s look at an example. Say you’re single with no dependents, and your taxable income is $9,000. Your marginal tax rate, according to the Federal Income Brackets chart above, is 10%. This means you pay $900 in income tax. Simple, right? What if your taxable income is $19,000? As a single filer, you’re now in the 12% tax bracket. However, that doesn’t mean you pay 12% on all your income. Instead, you pay 10% on the first $11,600, plus 12% of the amount over $11,600. What if your taxable income is $115,000? As a single filer, you moved up to the 24% bracket, so things get a bit more complicated. In this case: You pay 10% on the first $11,000 + 12% of the amount between $11,001 and $44,725 + 22% of the amount between $44,726 and $95,375 + 24% of the amount over $95,375. What is my effective tax rate? Your effective tax rate (ETR) is your total federal income tax liability divided by your taxable income (earned income and unearned income) — AKA the percent of your income that you pay in taxes. In the $115,000 example above, your effective tax rate would be: $20,643 (amount of tax owed) ÷ $115,000 (total income) = 17.95% ETR So, while your highest tax bracket would be 24% in this example, your income would be taxed at an average rate of 17.95%. Keep in mind, your ETR does not generally take into account any state income tax or local taxes you may owe. Some people think that if their income increases and they are bumped into a higher tax bracket, they will pay taxes at a higher rate on all their income. With this reasoning, some tax filers believe they may have less money left over than they would if they had earned less. Using the examples above, you can see that’s not true. Each dollar you earn only affects the federal income tax rate and taxes owed on additional income. It does not change the rate applied to dollars in lower tax brackets. Unless you are in the lowest bracket, you are actually in two or more brackets. If you are in the 24% tax bracket, for example, you pay taxes at four different rates – 10%, 12%, 22%, and 24%. Based on the tax brackets, you always have more money after taxes when you earn more income.

The IRS uses 7 brackets to calculate your tax bill based on your income and filing status. As your income rises it can push you into a higher tax bracket and may increase how much you owe. You don’t pay the same tax rate on every dollar of income. Your income is broken down by thresholds. As you surpass each threshold, your income gradually moves to a higher bracket with a higher tax rate. Your marginal tax rate is the rate you pay on your highest dollar of income. Your effective tax rate is the total percentage of income you pay in taxes. You can potentially lower your tax bill by contributing more to retirement plans, claiming more deductions, delaying income until the following year, and tax-loss harvesting. Figuring out how much you owe for taxes can be complex and sometimes takes some work. That’s because the federal government and the Internal Revenue Service (IRS) don’t assess the same amount of tax for every dollar you earn. Instead, the IRS assigns your income to brackets with tax rates that increase as you earn more money. Following are the federal tax tables and how to make sense of them to potentially reduce your upcoming tax bill. Source: Internal Revenue Service Source: Internal Revenue Service How do tax brackets work? The US has a progressive tax system at the federal level with 7 tax brackets. As you earn more money, the additional income jumps to a higher bracket with a higher tax rate. (Over a certain amount, your income is taxed no further.) The Internal Revenue Service adjusts federal income tax brackets annually to account for inflation, and the new brackets can help you estimate your tax obligation based on your income and filing status for the year. For example, a hypothetical single filer would owe 10% on the first $11,600 of taxable income in 2024 whether that amount represents their total earnings, or they earn $1 million. The next tax bracket is 12% of taxable income levels between $11,601 to $47,150. The tax rates continue to increase as someone’s income moves into higher brackets. The IRS uses different federal income tax brackets and ranges depending on filing status: Read more in Viewpoints about how tax brackets work. Sign up for Fidelity Viewpoints weekly email for our latest insights. How do you figure out what tax bracket you’re in? You can figure out what tax bracket you’re in using the tables published by the IRS (see tables above). To figure out your tax bracket, first look at the rates for the filing status you plan to use: single, married filing jointly, married filing separately, or head of household. Next, determine your taxable income. Start by adding up all the income you’ve earned for the year that will be taxed, such as from salary, bonuses, tips, freelance income, alimony (from an agreement finalized prior to 2019 that has not since been modified), and interest earnings. Subtract things like 401 (k) contributions and HSA contributions (these are already factored into your W-2, if you will receive one).

The IRS has released new tax brackets for 2025 and there’s good news. The brackets have increased again, meaning that you’ll have to make more before the amount you owe progressively jumps up. Below we’ll cover what the new tax brackets are and why the tax bracket you’re in isn’t the percent of your income that you’ll actually owe in tax. If you’re single (known as an individual filer), your brackets are: 10 percent: Up to $11,925 12 percent: $11,926 to $48,475 22 percent: $48,476 to $103,350 24 percent: $103,351 to $197,300 32 percent: $197,301 to $250,525 35 percent: $250,526 to $626,350 37 percent: Over $626,350 People who are married but file separately (known as married filing separately) have the same tax brackets as individual filers do until the top two. Those amounts are: 35 percent: $250,526 to $375,800 37 percent: Over $375,800 Want more? Get financial tips, tools, and more with our monthly newsletter. If you are married and file a single tax return as a couple (known as married filing jointly), your brackets are: 10 percent: Up to $23,850 12 percent: $23,851 to $96,950 Look back on Northwestern Mutual’s evolution under Chief Executive Officer John Schlifske and learn more about our approach to ensuring a seamless transition to our incoming CEO, Tim Gerend. What you owe in taxes is the income on your W-2 form multiplied by your tax bracket percentage, right? Unfortunately, it’s not that simple. For starters, the income on your W-2 isn’t likely to be the amount that is actually taxed. That’s because when you file, you’re probably going to take deductions that will lower your taxable income. You may choose to take the standard deduction (which, in 2025 is $15,000, or $30,000 if you’re filing jointly) or a host of other deductions you choose to itemize on your tax return. Your 1040 form helps you determine what your taxable income will be. Second, the U.S. income tax system is a progressive tax, not a flat tax. That means as your income rises, so does the percentage that you pay in taxes—and your income is actually taxed in chunks at graduated rates that follow the steps of the tax brackets. Here’s a simple example of what we mean. Let’s say you’re single, and after deductions, your taxable income is $70,000, which lands you in the 22 percent tax bracket. You won’t be paying 22 percent on all $70,000 (which would be $15,400 in federal tax). Your marginal tax bracket is the tax rate you paid on your last dollar of income and is how you determine which tax bracket you’re in. Your effective tax rate, meanwhile, is the percentage of your income that you paid in taxes after all was said and done—in this case, a little less than 15 percent ($10,313.50/$70,000). Our advisors are here to give you more of the information you want, and the knowledge you never knew you needed. To get to your next goal, and the next. Of course, your tax bracket and effective tax rate aren’t something that you figure out once and then never again. For instance, if you got a raise in the last year, it could push you into the next higher tax bracket (that’s why the tax brackets also increase over time). On the flip side, if your income drops or you become eligible to take more deductions, you could fall into a lower tax bracket. So make sure you check each year to see what the new tax brackets are and how that could impact the amount you will pay. This publication is not intended as legal or tax advice. Consult with a tax professional for tax advice specific to your situation. Want more? Get financial tips, tools, and more with our monthly newsletter. FINRA SIPC The IRS has released new income thresholds for tax brackets and a new standard deduction for 2025. Here are the new numbers and how to use them to calculate the amount of federal tax you may owe..

With our tax bracket calculator, you can quickly check which tax bracket you are in and find the federal income tax on your income. Besides, you can check how the final amount is computed and the final tax rate applied to your net income for better insight. Read further, and we will show you the tax brackets for 2024 besides 2021, 2022, and 2023 and explain how to calculate tax brackets so you can better understand how tax brackets work. In addition, since you can compute the effective tax rate on your income, you can also use the present tool as an income tax rate calculator. If you would like to check how much tax would be on a lottery prize, check our lottery tax calculator or apply the sales tax calculator to compute the tax amount when you make a purchase. How do tax brackets work? The federal government imposes the federal income tax for individuals in the United States and determines different tax rates depending on the income earned in a given year. The tax rates are applied to different income ranges, which form the so-called federal tax brackets. The structure of the US tax brackets conforms to the progressive tax system, which ensures that all taxpayers pay the same rates on the same levels of taxable income. Progressive taxation aims at reducing income inequality since people with lower incomes pay less tax. Since real incomes change with the overall price level, the Internal Revenue Service (IRS) adjusts US income tax brackets year by year. Updating tax brackets helps avoid a so-called bracket creep, a situation when someone falls in a higher income tax bracket due to inflation. Until 2018 the IRS applied the Consumer Price Index (CPI) to measure inflation. However, with the Tax Cuts and Jobs Act of 2017, the IRS now employs the Chained Consumer Price Index (C-CPI) to adjust federal tax brackets. What tax bracket am I in? – How to apply the tax bracket calculator It is straightforward to use the tax bracket calculator as you need to set only three parameters: Choose the reference year you want to find your tax bracket for. For example, you might want to know what the tax bracket for 2023 is. Set the filings status that applies to you. Give the taxable net income you earned in the given year. Add the total deductions to reduce the taxable income – Note that if you don't set a deduction or it is less than the standard deduction, the standard deduction will be considered. You will see the result immediately after setting these variables below the income tax rate calculator. Moreover, you will see the relevant tax brackets and the effective tax rate on your total income, that is, the actual percentage of your income paid as federal income tax. What are the tax brackets for 2024? – Income tax brackets 2024 The following tables summarize the progressively applied income tax rates in each tax bracket for 2024. We used the same figures in our 2024 tax bracket calculator, but you can even compute your tax by hand if you want to double-check. Single filers tax brackets 2024