Understanding Federal Tax Brackets for 2025
Let me walk you through the federal tax brackets for tax year 2025, which you'll use when filing in 2026. There are seven brackets with rates of 10%, 12%, 22%, 24%, 32%, 35%, and 37%. These match what we had for 2024.
You should know that these brackets are part of a progressive tax system. As your income increases, so does the tax rate applied to higher portions of it. If your income is low, you fall into brackets with lower rates; higher earners hit the brackets with steeper rates.
These brackets stem from the Tax Cuts and Jobs Act of 2017, but the IRS adjusts the income thresholds annually for inflation.
Key Takeaways on Tax Brackets
Right now, the US has seven federal tax brackets ranging from 10% to 37%. The system is progressive, meaning lower-income folks pay lower rates, and higher earners pay more. Unless all your income fits into the lowest bracket, you'll pay taxes at multiple rates based on how your income spills into higher brackets.
The IRS typically tweaks these brackets each year for inflation. You can legally cut your tax bill by reducing taxable income through retirement contributions or claiming eligible tax credits.
2025 Marginal Tax Rates by Income and Tax Filing Status
- 10%: Single filers $11,925 or less; Married filing jointly $23,850 or less
- 12%: Single $11,926 to $48,475; Joint $23,851 to $96,950
- 22%: Single $48,476 to $103,350; Joint $96,951 to $206,700
- 24%: Single $103,351 to $197,300; Joint $206,701 to $394,600
- 32%: Single $197,301 to $250,525; Joint $394,601 to $501,050
- 35%: Single $250,526 to $626,350; Joint $501,051 to $751,600
- 37%: Single over $626,350; Joint over $751,600
2024 Marginal Tax Rates by Income and Tax Filing Status (for Comparison)
- 10%: Single $11,600 or less; Joint $23,200 or less; Separate $11,600 or less; Head of Household $16,550 or less
- 12%: Single $11,601 to $47,150; Joint $23,201 to $94,300; Separate $11,601 to $47,150; Head $16,551 to $63,100
- 22%: Single $47,151 to $100,525; Joint $94,301 to $201,050; Separate $47,151 to $100,525; Head $63,101 to $100,500
- 24%: Single $100,526 to $191,950; Joint $201,051 to $383,900; Separate $100,526 to $191,950; Head $100,501 to $191,950
- 32%: Single $191,951 to $243,725; Joint $383,901 to $487,450; Separate $191,951 to $243,725; Head $191,951 to $243,700
- 35%: Single $243,726 to $609,350; Joint $487,451 to $731,200; Separate $243,726 to $365,600; Head $243,701 to $609,350
- 37%: Single over $609,351; Joint over $731,201; Separate over $365,601; Head over $609,351
How Income Tax Brackets Work
Most of you won't just fall into one bracket unless your income is very low. Your income gets taxed at progressive rates, meaning different parts are hit with different rates based on the brackets they fall into. The ranges depend on your filing status—single, married filing jointly, and so on.
Take an example: If you're single with $100,000 income in 2025, you're in the 22% bracket, but not all of it gets taxed at 22%. Instead, portions are taxed at 10%, 12%, and 22%, so you pay less overall than a flat 22%. This means your bracket isn't your effective tax rate—the actual percentage of income you pay in taxes.
You can find your bracket using IRS tables or online calculators. Just input your filing status and taxable income. Remember, it can change yearly with inflation, income shifts, or status changes, so check it annually.
Example: Calculating Your Taxes
Let's say you're a single filer with $50,000 taxable income in 2025. The first $11,925 is taxed at 10%, which is $1,192.50. Then, from $11,926 to $48,475—that's $36,549—gets 12%, equaling $4,385.88. The remaining $1,525 hits 22%, or $335.50.
Add them up: $1,192.50 + $4,385.88 + $335.50 = $5,913.88 in total taxes. Your effective rate is about 12%—divide taxes by income and multiply by 100.
What Is a Marginal Tax Rate?
In our progressive system, the marginal tax rate is what you pay on the next dollar of income that pushes you into a higher bracket. Rates increase with income levels, so you pay the lowest on the first chunk, higher on the next, and so on.
To find yours, calculate taxable income first—earned plus investment minus adjustments and deductions.
What Is an Effective Tax Rate?
Your effective rate is the overall percentage of taxable income you owe in taxes. It's lower than your marginal rate because income is tiered. On Form 1040, divide line 24 (total tax) by line 15 (taxable income), then multiply by 100.
How to Reduce Your Taxes
Deductions lower your taxable income, so maximize them. Contribute to a 401(k) or traditional IRA. If you have a high-deductible health plan, use an HSA—payroll contributions are tax-free. FSAs also help.
Credits subtract directly from your tax bill. Claim what you qualify for, like the Child Tax Credit, EITC, education credits, or Saver's Credit.
State Tax Brackets
Some states skip income tax altogether: Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Wyoming. Washington taxes certain investment income for high earners, and New Hampshire is phasing out taxes on investment income and interest, making eight states tax-free by end of 2024.
Twelve states use a flat rate in 2024, like Arizona at 2.5% or California topping at 13.3% with up to nine brackets. State rules might follow federal ones or not, with their own exemptions and deductions.
Common Questions
To find your bracket, know your filing status and check IRS tables for where your taxable income fits—that's your marginal rate. For example, married joint with $115,000 is 22%.
There's no 40% bracket; top is 37% over $626,350 single or $751,600 joint.
Calculate by using the tables or IRS site for detailed breakdowns.
The Bottom Line
Our federal system is progressive, with lower brackets paying less and higher ones more. For 2024 and 2025, seven brackets from 10% to 37%. If you're not in the lowest, your income faces multiple rates, not just the top one for your bracket.
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