A tax bracket is a range of incomes subject to a certain income tax rate. Tax brackets result in a progressive tax system, in which taxation increases as an individual's income grows: Low incomes fall into tax brackets with relatively low income tax rates, while higher earnings fall into brackets with higher rates.
Until 2018, there have been seven federal tax brackets, each assigned a different rate, ranging from 10% to 39.6%, with the dollar ranges in each varying for single filer, married joint filers (and qualifying widow(ers), married filing separately filers and head of household filers, resulting in 28 effective tax brackets.
Beginning in 2018, the federal tax brackets will be updated. There will still be seven brackets, but the new tax rates will range from 10% to 37%. There are two exceptions – the lowest tax bracket and the second-highest – individual tax rates will decrease across the board. The income ranges covered by certain brackets will also shift, potentially meaning many Americans will pay lower taxes in 2018 and some will pay more.
For 2018, there are seven IRS tax brackets. Here's how they look as of this writing:
2018 tax brackets and income ranges for single taxpayers
10%: $0 to $9,525 of taxable income
12%: $9,526 to $38,700
22%: $38,701 to $82,500
24%: $82,501 to $157,500
32%: $157,501 to $200,000
35%: $200,001 to $500,000
37%: over $500,000
Standard deduction: $12,000
2018 tax brackets and income ranges for married taxpayers filing jointly and surviving spouses
10%: $0 to $19,050 of taxable income
12%: $19,051 to $77,400
22%: $77,401 to $165,000
24%: $165,001 to $315,000
32%: $315,001 to $400,000
35%: $400,001 to $600,000
37%: over $600,000
Standard deduction: $24,000
2018 tax brackets and income ranges for taxpayers filing as head of household
10%: $0 to $13,600 of taxable income
12%: $13,601 to $51,800
22%: $51,801 to $82,500
24%: $82,501 to $157,500
32%: $157,501 to $200,000
35%: $200,001 to $500,000
37%: over $500,000
Standard deduction: $18,000
2018 tax brackets and income ranges for married taxpayers filing separately
10%: $0 to $9,525 of taxable income
12%: $9,526 to $38,700
22%: $38,701 to $82,500
24%: $82,501 to $157,500
32%: $157,501 to $200,000
35%: $200,001 to $300,000
37%: over $300,000
Standard deduction: $12,000