The IRS announced higher federal income tax brackets and standard deductions for 2024 on Thursday.
The agency increased the income thresholds for each bracket, applying to tax year 2024 for returns filed in 2025. For 2024, the maximum rate of 37% applies to individuals whose taxable income is above $609,350 and married couples jointly earning $731,200.
The federal income brackets show how much you’ll owe on each part of your “taxable income,” calculated by subtracting the greater of the standard or itemized deductions from your adjusted gross income.
Higher standard deduction
The standard deduction will also increase in 2024, increasing to $29,200 for married couples filing jointly, up from $27,700 in 2023. Singles can claim $14,600, an increase from $13,850.
Adjustments for other tax provisions
The IRS also increased the numbers on dozens of other provisions, such as the alternative minimum tax, a parallel system for high earners, and the estate tax exemption for wealthy families.
There is also a higher earned income tax credit, bringing the deduction to a maximum of $7,830 for low- and moderate-income filers. And employees can dedicate $3,200 to healthcare flexible spending accounts.
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