2025 Tax Bracket Increases Could Be a Win for Your Paycheck. Here’s Why
Now that we are in 2025, IRS updated income tax brackets Higher deduction standards are already in effect. Depending on your income level, these changes could add to your salary or next year’s tax return.
If you’re in a lower tax bracket this year, you’ll pay a lower tax rate, which may slightly increase the amount you take home each pay period. In some cases, a higher standard deduction can also help lower your tax bill or increase your income.
It’s normal for the IRS to change tax laws every year to explain the situation inflation. This helps prevent “tax bracket creep”, which may push you into a higher tax bracket, Even if inflation is eating into your salary.
These new tax changes take effect on January 1st. Here’s everything you need to know about next year’s income tax brackets, increases in the standard deduction and how tax changes will affect your money.
Read more: Will we see more tax relief next year? Who benefits from Trump’s tax plan?
How tax law changes affect your paycheck
When the IRS raises federal income tax brackets, you may fall into a different tax bracket from the previous year, even if your income remains the same.
For example, if you earned $48,000 last year, you were in the 22% tax bracket. But if your income stayed at the same level throughout 2025, your income would drop to 12%. This means you will have to pay less federal taxes and take less money out of your paycheck.
If you earn more in 2025 than you did in 2024, your salary increase will determine your ranking. You may still be in a lower tax bracket or the same tax bracket. In some cases, your tax bracket and rate may increase.
2025 income tax brackets
Your federal income tax bracket helps determine how much tax you will pay in a given tax year, not including the standard deduction or any Itemized tax deductions.
2025 single filer income tax rates
| taxable income | federal tax rate |
|---|---|
| $11,925 or less | 10% |
| US$11,926 to US$48,475 | $1,192.50 plus 12% of income above $11,925 |
| $48,476 to $103,350 | $5,578.50 plus 22% of income above $48,475 |
| US$103,351 to US$197,300 | $17,651 plus 24% of income over $103,350 |
| $197,301 to $250,525 | $40,199 plus 32% of income over $197,300 |
| $250,526 to $626,350 | $57,231 plus 35% of income over $250,525 |
| $626,351 or more | $609,350 $188,769.75 plus 37% of income over $626,350 |
2025 income tax rates for married, filing jointly
| taxable income | federal tax rate |
|---|---|
| $23,850 or less | 10% |
| $23,851 to $96,950 | $2,385 plus 12% of income above $23,850 |
| $96,951 to $206,700 | $11,157 plus 22% of income above $96,950 |
| US$206,701 to US$394,600 | $35,302 plus 24% of income above $206,700 |
| $394,601 to $501,050 | $80,398 plus 32% of income above $394,600 |
| $501,051 to $751,600 | $114,462 plus 35% of income over $501,050 |
| $751,601 or more | $202,154.50 plus 37% of income above $751,600 |
Income tax brackets for head of household filers in 2025
| taxable income | federal tax rate |
|---|---|
| $17,000 or less | 10% |
| $17,001 to $64,850 | $1,700 plus 12% of income over $17,000 |
| $64,851 to $103,350 | $7,442 plus 22% of income over $64,850 |
| US$103,351 to US$197,300 | $15,912 plus 24% of income over $103,350 |
| $197,301 to $250,500 | $38,460 plus 32% of income over $197,300 |
| $250,501 to $626,350 | $55,484 plus 35% of income over $250,500 |
| $626,351 or more | $187,031.50 plus 37% of income over $626,350 |
Standard deduction for 2025
The standard deduction for single filers has increased to $15,000 in 2025, an increase of $400 from 2024. For married filers filing jointly, the standard deduction has been increased to $30,000, an increase of $800 from the previous year.
IRS standard deduction
| Filing status | 2024 | 2025 |
|---|---|---|
| Single or married, submit separately | $14,600 | $15,000 |
| Married, filing jointly | $29,200 | $30,000 |
| Head of household | $21,900 | $22,500 |
Source of all charts: IRS (PDF).
most taxpayers Simple tax return Claim the standard deduction, which reduces their taxable income. If you receive wages solely from your employer as a W-2 employee, the standard deduction is usually the best way to maximize your tax refund. if you are self employed Or you want to claim specific deductions, you will itemize your deductions.
Other 2025 tax changes that may help you
There are other tax changes coming next year that could put more money in your paycheck. If you receive Social Security, you will receive Cost of living adjustment 2.5% in 2025. The earned income tax credit also increases to $8,046 for taxpayers with three or more qualifying children.
There are also increases in the foreign earned income exclusion, estate tax credit, annual gift exclusion and adoption credit.
