The IRS recently announced their annual inflation adjustments for the tax year 2024. These changes include updates to the standard deduction and tax brackets.
Standard Deduction
The standard deduction will rise for both single filers and married couples filing jointly:
- Married Couples Filing Jointly: increase from $27,700 to $29,200 ($1,500 increase)
- Single Taxpayers and Married Individuals filing separately: increase from $13,850 to $14,600 ($750 increase)
Tax Brackets
The IRS made the following adjustments to offset inflation so that taxpayers are not placed into higher tax brackets simply due to a rise in income.
10% Bracket
Single filers: taxable income of $11,600 or less
Married couples filing jointly: taxable of $23,200 or less
12% Bracket
Single filers: taxable income between $11,601 and $47,149
Married couples filing jointly: taxable income between $23,201 and $94,299
22% Bracket
Single filers: taxable income between $47,150 and $100,524
Married couples filing jointly: taxable income between $94,300 and $201,049
24% Bracket
Single filers: taxable income between $100,525 and $191,949
Married couples filing jointly: taxable income between $201,050 and $383,899
32% Bracket
Single filers: taxable income between $191,950 and $243,724
Married couples filing jointly: taxable income between $383,899 and $487,449
35% Bracket
Single filers: taxable income between $243,725 and $609,349
Married couples filing jointly: taxable income between $487,450 and $731,199
The top tax rate remains 37% for individual single taxpayers with incomes greater than $609,350 ($731,200 for married couples filing jointly).
Earned Income Tax Credit
The maximum Earned Income Tax Credit for tax year 2024 for those qualifying taxpayers with three or more qualifying children is $7,830. This is an increase of $400 from tax year 2023.
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