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IRS Tax Brackets & Deductions

The tax code in the United States is very complex and difficult to understand. All individuals and business owners, however, should at least have a good idea of what the different tax brackets are so they can estimate how much they will owe.

2018 Tax Brackets for Individuals

There are seven different tax brackets for federal income taxes as of 2018. They are 10%, 12%, 22%, 24%, 35%, and 37% respectively. Determining which bracket you will land in is based on a number of different factors. Your income and your filing status play major roles. These tax rates came to fruition as of the Tax Jobs and Cuts Act of 2018, which took effect January 1st of 2018.

This law reduced the top tier tax rate from 39.6% to 37%. The lowest tax bracket, 10%, remained in place but it now applies to a greater portion of the income that will be taxed at this lower rate. This is because when you move into a new tax bracket, only the amount you earn above the previous tax bracket limits will be taxed at the higher rate.

Single

Taxable Income Tax Rate
$0 – $9,525 10% of taxable income
$9,526 – $38,700 $952.50 plus 12% of the amount over $9,525
$38,701 – $82,500 $4,453.50 plus 22% of the amount over $38,700
$82,501 – $157,500 $14,089.50 plus 24% of the amount over $82,500
$157,501 – $200,000 $32,089.50 plus 32% of the amount over $157,500
$200,001 – $500,000 $45,689.50 plus 35% of the amount over $200,000
$500,001 or more $150,689.50 plus 37% of the amount over $500,000

 

Married Filing Jointly or Qualifying Widow(er)

Taxable Income Tax Rate
$0 – $19,050 10% of taxable income
$19,051 – $77,400 $1,905 plus 12% of the amount over $19,050
$77,401 – $165,000 $8,907 plus 22% of the amount over $77,400
$165,001 – $315,000 $28,179 plus 24% of the amount over $165,000
$315,001 – $400,000 $64,179 plus 32% of the amount over $315,000
$400,001 – $600,000 $91,379 plus 35% of the amount over $400,000
$600,001 or more $161,379 plus 37% of the amount over $600,000

 

Married Filing Separately

Taxable Income Tax Rate
$0 – $9,525 10% of taxable income
$9,526 – $38,700 $952.50 plus 12% of the amount over $9,525
$38,701 – $82,500 $4,453.50 plus 22% of the amount over $38,700
$82,501 – $157,500 $14,089.50 plus 24% of the amount over $82,500
$157,501 – $200,000 $32,089.50 plus 32% of the amount over $157,500
$200,001 – $300,000 $45,689.50 plus 35% of the amount over $200,000
$300,001 or more $80,689.50 plus 37% of the amount over $300,000

 

Head of Household

Taxable Income Tax Rate
$0 – $13,600 10% of taxable income
$13,601 – $51,800 $1,360 plus 12% of the amount over $13,600
$51,801 – $82,500 $5,944 plus 22% of the amount over $51,800
$82,501 – $157,500 $12,698 plus 24% of the amount over $82,500
$157,501 – $200,000 $30,698 plus 32% of the amount over $157,500
$200,001 – $500,000 $44,298 plus 35% of the amount over $200,000
$500,001 or more $149,298 plus 37% of the amount over $500,000

NOTE: There are no personal exemption amounts for 2018.

Standard Deduction Amounts for 2018

For those who use the standard deduction in 2018, it is pretty simple to calculate. The amount you are able to deduct will depend directly on how you file your taxes. The deduction options are as follows:

Filing Status Standard Deduction
Single $12,000
Married Filing Jointly or Qualifying Widow(er) $24,000
Married Filing Separately $12,000
Head of Household $18,000

 

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