The IRS tax brackets are set to change for the 2025 tax year, offering potential tax savings for many taxpayers. Understanding these changes can help you plan your finances better.
Increased Tax Bracket Limits for 2025
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In 2025, the tax brackets will be adjusted to account for inflation and provide relief to taxpayers. Here’s a quick overview of the new brackets:
- Single Filers: Taxpayers will pay 10% on income up to $11,600, 12% on income between $11,601 and $47,150, and so on.
- Married Couples Filing Jointly: The new brackets start at 10% for income up to $23,200, and go up to 37% for income over $731,200.
Benefits for Couples Filing Jointly
Couples filing jointly will see significant benefits in 2025. The 12% bracket will apply to incomes up to $94,300, compared to $89,450 in 2024. This increase allows couples to earn more before hitting a higher tax rate.
Comparing 2024 and 2025 Tax Brackets
according to tododisca, In 2024, a couple earning $94,000 would be taxed at 22%, whereas in 2025, they would benefit from a 12% tax rate on the same income. This change represents a significant tax savings opportunity.
Planning for Tax Savings
With the IRS adjusting tax brackets for 2025, it’s an excellent time to review your tax planning strategy. Consider consulting a tax professional to ensure you make the most of these changes.
Conclusion
The upcoming adjustments to the IRS tax brackets in 2025 will benefit many taxpayers by reducing their tax rates. Stay informed and plan ahead to maximize your savings.