2025 tax brackets: What to know for next year’s taxes
According to The Street, While inflation has slowed down, taxpayers can still expect inflation adjustments to their 2025 taxes, albeit with the smallest increase seen in recent years. On October 22, 2024, the IRS revealed the inflation-adjusted tax brackets for 2025, which include an increase in the standard deduction and adjustments to income thresholds.
Minimal Adjustments Amid Decreasing Inflation
The IRS has raised tax brackets by approximately 2.8% for the 2025 tax year, marking the smallest adjustment in three years. This minor increase is attributed to the falling inflationary pressures, with the consumer price index reflecting its lowest levels since February 2021. For comparison, adjustments were significantly higher in previous years, with a 5.4% increase in 2024 and a 7.1% boost in 2023.
By adjusting tax brackets, the IRS aims to mitigate “bracket creep,” a phenomenon where inflation pushes taxable income into higher brackets without an actual increase in purchasing power.
Changes to the Standard Deduction
For 2025, the standard deduction will also see an increase of about 2.8%. This deduction is the most common method used by taxpayers to reduce their taxable income, which can result in lower tax bills for many Americans.
Tax year 2024 standard deductions vs tax year 2025 standard deductions
| Filing Type | Tax Year 2024 | Tax Year 2025 | Change |
|---|---|---|---|
| Single filers | $14,600 | $15,000 | $400 or 2.8% |
| Married filing jointly | $29,200 | $30,000 | $800 or 2.8% |
| Married filing separately | $14,600 | $15,000 | $400 or 2.8% |
| Heads of household | $21,900 | $22,500 | $600 or 2.8% |
Additional Standard Deduction for Seniors and Disabled Individuals
Taxpayers aged 65 and older can qualify for an additional standard deduction of $2,000 if filing as single or head of household, and $800 per qualifying individual for married filers. Furthermore, individuals classified as blind by the IRS can claim an additional deduction of $1,850 for single filers or heads of household, and $1,500 for married couples.
To determine your standard deduction, you can use the IRS’s standard deduction calculator.
Other Tax Breaks for Tax Year 2025
Taxpayers with three or more qualifying children can benefit from the Earned Income Tax Credit (EITC), which has increased to $8,046 for 2025, reflecting a $216 increase from 2024. Additionally, the basic exclusion amount for the Estate Tax has risen by 2.8%, increasing to $13,990,000 for estates of decedents who die in 2025.
Tax Brackets for 2025
The IRS maintains seven federal tax brackets for 2025, each with increased income limits of about 2.8%. Here’s how the brackets are structured based on filing status:
2025 tax brackets for single filers
| Taxable Income | Tax rate |
|---|---|
| $0–$11,925 | 10% of the taxable income |
| $11,926–$48,475 | $1,192.50 + 12% of the amount over $11,925 |
| $48,476–$103,350 | $5,578.50 + 22% of the amount over $48,475 |
| $103,351–$197,300 | $17,651 + 24% of the amount over $103,350 |
| $197,301–$250,525 | $40,199 plus 32% of the amount over $197,300 |
| $250,526–$626,350 | $57,231 + 35% of the amount over $250,525 |
| $626,351 and above | $188,769.75 + 37% of the amount over $626,350 |
2025 tax brackets for married couples filing jointly
| Taxable Income | Tax rate |
|---|---|
| $0–$23,850 | 10% of the taxable income |
| $23,851–$96,950 | $2,385 + 12% of the amount over $23,850 |
| $96,951–$206,700 | $11,157 + 22% of the amount over $96,950 |
| $206,701–$394,600 | $35,302 + 24% of the amount over $394,600 |
| $394,601–$501,050 | $80,398 plus 32% of the amount over $394,600 |
| $501,051–$751,600 | $114,462 + 35% of the amount over $501,050 |
| $751,601 and above | $202,154.50 + 37% of the amount over $751,600 |
2025 tax brackets for married couples filing jointly
| Taxable Income | Tax rate |
|---|---|
| $0–$23,850 | 10% of the taxable income |
| $23,851–$96,950 | $2,385 + 12% of the amount over $23,850 |
| $96,951–$206,700 | $11,157 + 22% of the amount over $96,950 |
| $206,701–$394,600 | $35,302 + 24% of the amount over $394,600 |
| $394,601–$501,050 | $80,398 plus 32% of the amount over $394,600 |
| $501,051–$751,600 | $114,462 + 35% of the amount over $501,050 |
| $751,601 and above | $202,154.50 + 37% of the amount over $751,600 |
2025 tax brackets for married couples filing separately
| Taxable Income | Tax rate |
|---|---|
| $0–$11,925 | 10% of the taxable income |
| $11,926–$48,475 | $1,192.50 + 12% of the amount over $11,925 |
| $48,476–$103,350 | $5,578.50 + 22% of the amount over $48,475 |
| $103,351–$197,300 | $17,651 + 24% of the amount over $103,350 |
| $197,301–$250,525 | $40,199 plus 32% of the amount over $197,300 |
| $250,526–$375,800 | $57,231 + 35% of the amount over $250,525 |
| $375,801 and above | $101,077.25 + 37% of the amount over $375,800 |
2025 tax brackets for heads of household
| Taxable income | Tax rate |
|---|---|
| $0–$17,000 | 10% of the taxable income |
| $17,001–$64,850 | $1,700 + 12% of the amount over $17,000 |
| $64,851–$103,350 | $7,442 + 22% of the amount over $64,850 |
| $103,351–$197,300 | $15,912 + 24% of the amount over $103,350 |
| $197,301–$250,500 | $38,460 plus 32% of the amount over $197,300 |
| $250,501–$626,350 | $55,484 + 35% of the amount over $250,500 |
| $626,351 and above | $187,031.50 + 37% of the amount over $626,350 |
Important Tax Filing Dates
The tax brackets apply to income earned in 2025, with the filing period opening in early 2026 and closing in April 2026, barring any extensions.
Potential Expiration of Trump’s Tax Cuts
The Tax Cuts and Jobs Act of 2017, signed into law by former President Donald Trump, is set to expire in 2026 unless Congress takes action. This Act, which significantly overhauled the U.S. tax system, nearly doubled the standard deduction and lowered the corporate tax rate to 21%. Trump has pledged to extend these tax cuts, while Vice President Kamala Harris has promised not to raise taxes on individuals earning less than $400,000 per year.
As taxpayers prepare for the upcoming tax year, it’s essential to stay informed about these adjustments and plan accordingly.
