IRS unveils 2025 income tax brackets: Where do you fall?
(NEXSTAR) — It's official: 2025 will mark another year in which millions of Americans could take home more on each paycheck thanks in part to the latest inflation adjustments to the tax code announced by the IRS on Tuesday.
More than 60 tax provisions are changing, all of which will impact tax year 2025. That means they won't apply until you're filing taxes in 2026.
One of the most notable changes the IRS has announced are standard deductions rising and individual tax brackets shifting.
Standard deductions rise
Starting in tax year 2025, single taxpayers and married individuals filing separately will see their standard deduction rise to $15,000, up $400 from the current rate of $14,600. If you're married and filing jointly, your standard deduction will rise by $800 to $30,000, while heads of households will see an increase of $600 for a standard deduction of $22,500.
Remember, a standard deduction reduces how much of your income on which you are taxed.
Tax brackets for tax year 2025
As it did last year, the IRS is also adjusting the tax brackets. These determine the portion of your income that is taxable after the standard deduction or itemized deductions are subtracted.
Below is a table that breaks down each of those marginal tax brackets:
| If your taxable income is greater than: | Taxes owed |
|---|---|
| $626,350 ($751,600 for married couples filing jointly) | 37% |
| $250,525 ($501,050 for married couples filing jointly) | 35% |
| $197,300 ($394,600 for married couples filing jointly) | 32% |
| $103,350 ($206,700 for married couples filing jointly) | 24% |
| $48,475 ($96,950 for married couples filing jointly) | 22% |
| $11,925 ($23,850 for married couples filing jointly) | 12% |
| $11,925 or less ($23,850 or less for married couples filing jointly) | 10% |
These income thresholds have all increased slightly over last year. The lowest level, for example, increased by $325, while the second-highest rose by $1,325.
What is not changing is the top tax rate. The IRS says that will remain at 37% for individual single taxpayers with incomes above $626,350 and for married couples filing jointly with incomes above $751,600.
What else is changing?
There are a handful of other notable changes that could impact a large swath of taxpayers.
For example, in tax year 2025, the maximum Earned Income Tax Credit amount will increase from $7,830 to $8,046 for qualifying taxpayers with three or more qualifying children.
The alternative minimum tax exemption amount will increase to $88,100 for individual filers, up $2,400 over the previous year. For married individuals filing separately, the exemption amount will increase to $68,650. For both groups, the exemption phases out at $626,350.
For married couples filing together, the exemption amount will rise to $137,000, phasing out at $1,252,700.
You can find more details about changes to qualified transportation fringe benefits, medical savings accounts, foreign earned income exclusions, adoption credits, and more updates on the IRS's website.
What isn't changing in tax year 2025?
While updates abound for our next tax year, there are some areas of the tax code that will not be updated.
That includes the personal exemptions, which will remain at 0, just as it is for the current tax year. There will continue to be no limitation on itemized deductions, and the adjusted gross income amount taxpayers use to determine the reduction in the Lifetime Learning Credit is not being adjusted.
Marginal tax brackets, standard deductions, and other changes you can expect to see for tax year 2024 can be found here.
The next two Tax Days will not be interrupted by weird calendar years as they both fall on April 15 — a Tuesday in 2025 and a Wednesday in 2026.
Jeremy Tanner contributed to this report.