The income tax rates in the United States will remain unchanged for both the current and upcoming tax seasons. However, due to the largest price increases in decades, the tax brackets—the income bands that are taxed at progressively higher rates—have suffered significant inflation changes.
The tax brackets for the 2023 tax year, which have upper limits 7% higher than the levels for 2022 returns, have been issued by the IRS. The likelihood of paying higher tax rates is decreased if your income isn’t increasing in line with inflation thanks to the bracket increases.
You may calculate how much taxes you should anticipate paying annually using the tax brackets. These are the rates from the 2022–2023 tax season along with the tax brackets for the forthcoming 2023–2024 tax year. Additionally, guidance for figuring up your income tax based on the highest applicable bracket will be provided.
Tax Bracket for 2023 (Due in April of 2024)
The seven federal income tax brackets for the 2022–2023 season will remain the same for the 2023 tax year, which corresponds to the return you will submit in 2024: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. The bracket you are in is determined by your taxable income (including wages) and filing status.
Tax Brackets for 2023: Single Filer
| If taxable income is: | The tax due is: |
|---|---|
| Not over $11,000 | 10% of taxable income |
| Over $11,000 but not over $44,725 | $1,100 plus 12% of the excess over $11,000 |
| Over $44,725 but not over $95,375 | $5,147 plus 22% of the excess over $44,725 |
| Over $95,375 but not over $182,100 | $16,290 plus 24% of the excess over $95,375 |
| Over $182,100 but not over $231,250 | $37,104 plus 32% of the excess over $182,100 |
| Over $231,250 but not over $578,125 | $52,832 plus 35% of the excess over $231,250 |
| Over $578,125 | $174,238.25 plus 37% of the excess over $578,125 |
2023 Tax Brackets: Married Filing Separately
| If taxable income is: | The tax due is: |
|---|---|
| Not over $11,000 | 10% of taxable income |
| Over $11,000 but not over $44,725 | $1,100 plus 12% of the excess over $11,000 |
| Over $44,725 but not over $95,375 | $5,147 plus 22% of the excess over $44,725 |
| Over $95,375 but not over $182,100 | $16,290 plus 24% of the excess over $95,375 |
| Over $182,100 but not over $231,250 | $37,104 plus 32% of the excess over $182,100 |
| Over $231,250 but not over $346,875 | $52,832 plus 35% of the excess over $231,250 |
| Over $346,875 | $93,300.75 plus 37% of the excess over $346,875 |
2023 Tax Brackets: Head of Household
| If taxable income is: | The tax due is: |
|---|---|
| Not over $15,700 | 10% of taxable income |
| Over $15,700 but not over $59,850 | $1,570 plus 12% of the excess over $15,700 |
| Over $59,850 but not over $95,350 | $6,868 plus 22% of the excess over $59,850 |
| Over $95,350 but not over $182,100 | $14,678 plus 24% of the excess over $95,350 |
| Over $182,100 but not over $231,250 | $35,498 plus 32% of the excess over $182,100 |
| Over $231,250 but not over $578,100 | $51,226 plus 35% of the excess over $231,250 |
| Over $578,100 | $172,623.50 plus 37% of the excess over $578,100 |
2023 Tax Brackets: Married Filing Jointly
| If taxable income is: | The tax due is: |
|---|---|
| Not over $22,000 | 10% of taxable income |
| Over $22,000 but not over $89,450 | $2,200 plus 12% of the excess over $22,000 |
| Over $89,450 but not over $190,750 | $10,294 plus 22% of the excess over $89,450 |
| Over $190,750 but not over $364,200 | $32,580 plus 24% of the excess over $190,750 |
| Over $364,200 but not over $462,500 | $74,208 plus 32% of the excess over $364,200 |
| Over $462,500 but not over $693,750 | $105,664 plus 35% of the excess over $462,500 |
| Over $693,750 | $186,601.50 plus 37% of the excess over $693,750 |
2022 Tax Brackets (Filing Extension Deadline October 2023)
For the 2022 tax year and the return you either filed by April 2023 or must now file by October, there are seven federal income tax brackets: 10%, 12%, 22%, 24%, 32%, 35% and 37%. Your tax bracket is determined by your filing status and taxable income.
Tax Brackets for 2022: Single Filer
| If taxable income is: | The tax due is: |
|---|---|
| Not over $10,275 | 10% of the taxable income |
| Over $10,275 but not over $41,775 | $1,027.50 plus 12% of the excess over $10,275 |
| Over $41,775 but not over $89,075 | $4,807.50 plus 22% of the excess over $41,775 |
| Over $89,075 but not over $170,050 | $15,213.50 plus 24% of the excess over $89,075 |
| Over $170,050 but not over $215,950 | $34,647.50 plus 32% of the the excess over $170,050 |
| Over $215,950 but not over $539,900 | $49,335.50 plus 35% of the excess over $215,950 |
| Over $539,900 | $162,718 plus 37% of the excess over $539,900 |
2022 Tax Brackets: Separate Filing for Married People
| If taxable income is: | The tax due is: |
|---|---|
| Not over $10,275 | 10% of the taxable income |
| Over $10,275 but not over $41,775 | $1,027.50 plus 12% of the excess over $10,275 |
| Over $41,775 but not over $89,075 | $4,807.50 plus 22% of the excess over $41,775 |
| Over $89,075 but not over $170,050 | $15,213.50 plus 24% of the excess over $89,075 |
| Over $170,050 but not over $215,950 | $34,647.50 plus 32% of the the excess over $170,050 |
| Over $215,950 but not over $323,925 | $49,335.50 plus 35% of the excess over $215,950 |
| Over $323,925 | $86,127 plus 37% of the excess over $323,925 |
2022 Income Tax Rates: Head of Family
| If taxable income is: | The tax due is: |
|---|---|
| Not over $14,650 | 10% of the taxable income |
| Over $14,650 but not over $55,900 | $1,465 plus 12% of the excess over $14,650 |
| Over $55,900 but not over $89,050 | $6,415 plus 22% of the excess over $55,900 |
| Over $89,050 but not over $170,050 | $13,708 plus 24% of the excess over $89,050 |
| Over $170,050 but not over $215,950 | $33,148.50 plus 32% of the the excess over $170,050 |
| Over $215,950 but not over $539,900 | $47,836.50 plus 35% of the excess over $215,950 |
| Over $539,900 | $162,218.50 plus 37% of the excess over $539,900 |
2022 Tax Brackets: Joint Filing for Married Couples
| If taxable income is: | The tax due is: |
|---|---|
| Not over $20,550 | 10% of the taxable income |
| Over $20,550 but not over $83,550 | $2,055 plus 12% of the excess over $20,550 |
| Over $83,550 but not over $178,150 | $9,615 plus 22% of the excess over $83,550 |
| Over $178,150 but not over $340,100 | $30,427 plus 24% of the excess over $178,150 |
| Over $340,100 but not over $431,900 | $69,295 plus 32% of the excess over $340,100 |
| Over $431,900 but not over $647,850 | $98,671 plus 35% of the excess over $431,900 |
| Over $647,850 | $174,253.50 plus 37% of the excess over $647,850 |
The Tax Brackets: What Are They?
The IRS developed tax brackets to carry out America’s “progressive” tax system, which levies higher income levels at the previously indicated gradually rising rates. The amount that you must pay the IRS each year is determined in part by the brackets.
The amount of taxes you pay is based on your income. The taxes you pay will rise in tandem with your taxable income.
How Function Tax Brackets?
Determining your tax liability involves more than just comparing your pay to the aforementioned tax brackets. Assuming you are a single individual with a taxable income of $75,000 in 2023, your marginal tax rate would be 22%. However, a portion of your income will be subject to the 10% and 12% lower tax brackets.
Parts of your income are taxed at progressively higher rates as it climbs the ladder:
10% tax is applied to the first $10,275, or $1,027.50.
The remaining $31,500 ($41,775 – $10,275) is subject to 12% tax, or $3,780.
Taxed at a rate of 22%, the remaining $33,225 ($75,000 minus $41,775) equals $7,309.50.
(Ignoring any itemized or standard deduction applied to your taxes) $1,027.50 + $3,780 + $7,309.50 = $12,117 is the total tax amount for your $75,000 income.
How Your Federal Income Tax Bracket Is Calculated
By dividing your income into the amounts that will be subject to tax in each relevant bracket, you may compute your taxes. Each tax bracket has a unique tax rate. Depending on your filing status—single, married filing jointly, married filing separately, or head of household—you will be placed in a different bracket.
A Marginal Tax Rate: What Is It?
Your marginal tax bracket is the one into which your highest dollar amount of income is placed. Your highest tax rate, which is applied to the highest percentage of your income, is in this bracket. For the 2023–2024 tax year, use the federal income tax bracket calculator below to get your marginal tax percentage.
An Effective Tax Rate: What Is It?
Your effective tax rate is the average amount of taxes you will pay, whereas your marginal tax rate is the highest tax bracket you are in. You must divide the total amount of your taxes by your taxable income to determine your effective tax rate.
For illustration, suppose you are single and your taxable income in 2023 is $27,050. You anticipate having to pay $3,044 in taxes. When you divide $3,044 by $27,050, you get an effective tax rate of 11.3% even though your marginal tax rate is 12%.
Strategies for Entering a Lower Tax Bracket
By taking advantage of tax deductions, such as the write-offs for mortgage interest, property taxes, and charitable contributions, you can reduce your income and ultimately reach a lower tax rate. By lowering your taxable income, deductions assist in lowering your taxes.
You may also be able to reduce your tax rate by taking advantage of tax credits like the child tax credit or earned income tax credit. Credits allow you to reduce your tax liability dollar for dollar.
You can reduce the amount you pay Uncle Sam each year by utilizing both tax credits and deductions, depending on your financial condition.
[…] Read More: Federal Income Tax Rates & Tax Brackets 2023-2024 […]