IRS Reveals 2024 Tax Brackets: How Much Will You Save?

IRS Unveils Updated Tax Brackets for 2024

2024 Tax Brackets: Everything You Need to Know

The IRS recently released updated income tax thresholds for the upcoming tax year. These changes reflect annual inflation adjustments, ensuring taxpayers aren't unfairly pushed into higher brackets as wages rise with inflation. Here's a breakdown of what these updates mean and how they might affect your finances.

2024 Federal Income Tax Brackets

The U.S. tax system is progressive, meaning individuals are taxed at increasingly higher rates as their taxable income rises. For 2024, the IRS has adjusted the income ranges for each tax bracket, while the tax rates—10%, 12%, 22%, 24%, 32%, 35%, and 37%—remain the same. Below are the 2024 brackets for single filers and married couples filing jointly:

For Single Filers:

• 10%: $0 to $11,600

• 12%: $11,601 to $47,150

• 22%: $47,151 to $100,525

• 24%: $100,526 to $191,950

• 32%: $191,951 to $243,725

• 35%: $243,726 to $609,350

• 37%: $609,351 and above

  
  

For Married Filing Jointly:

• 10%: $0 to $23,200

• 12%: $23,201 to $94,300

• 22%: $94,301 to $201,050

• 24%: $201,051 to $383,900

• 32%: $383,901 to $487,450

• 35%: $487,451 to $731,200

• 37%: $731,201 and above

  
  

Standard Deduction Increases

The IRS has also raised the standard deduction:

• Single filers: $14,600 (up from $13,850 in 2023)

• Married couples filing jointly: $29,200 (up from $27,700 in 2023)

  
  

These increases reduce taxable income, potentially lowering overall tax liability.

What These Changes Mean

With the adjusted brackets and standard deductions, many Americans may see a slight reduction in their federal tax burden, depending on their income level and filing status. Taxpayers are encouraged to revisit their withholding and estimated tax payments to avoid surprises come tax season.

These updates highlight the importance of tax planning. Leveraging tax-advantaged accounts, such as 401(k)s and IRAs, and staying informed about changes will be key to minimizing tax liability in 2024.