For the 2025 tax year, the federal income tax brackets define the rates at which different portions of your taxable income are taxed. These brackets are adjusted annually for inflation to prevent "bracket creep," where inflation pushes taxpayers into higher brackets even if their purchasing power hasn't increased.
Understanding 2025 Federal Income Tax Brackets
The U.S. federal income tax system operates on a progressive scale, meaning different portions of your income are taxed at increasing rates. Your income isn't taxed at a single rate; instead, segments of your income fall into different brackets, each with its own tax rate.
Below are the income tax brackets for the 2025 tax year, for both single filers and those married filing jointly:
| Tax Rate | Single Income Range | Married Filing Jointly Income Range |
|---|---|---|
| 12% | $11,926 to $48,475 | $23,851 to $96,950 |
| 22% | $48,476 to $103,350 | $96,951 to $206,700 |
| 24% | $103,351 to $197,300 | $206,701 to $394,600 |
| 32% | $197,301 to $250,525 | $394,601 to $501,050 |
How Tax Brackets Work
It's crucial to understand that tax brackets refer to marginal tax rates, not your effective tax rate. Here's a quick breakdown:
- Marginal Tax Rate: This is the rate applied to your last dollar of income. For example, if you're a single filer and your taxable income is $50,000, not all $50,000 is taxed at the 22% rate.
- The first $11,925 is taxed at 10% (the lowest bracket, though not fully listed in the provided data).
- The income from $11,926 up to $48,475 is taxed at 12%.
- Only the portion of your income above $48,475 (up to $50,000 in this example) is taxed at 22%.
- Effective Tax Rate: This is the total amount of tax you pay divided by your total taxable income. Due to the progressive system, your effective tax rate is always lower than your highest marginal tax rate.
Understanding these brackets helps in financial planning and estimating your tax liability for the upcoming year.
