The IRS recently released annual inflation adjustments for the 2025 tax year. TheRevenue Procedure 2024-40document outlines updates and modifications to 60+ tax provisions that will affect taxpayers submitting returns in 2026.
How Will This Affect My Taxes During 2025?
Many tax payers will benefit from these inflation-driven adjustments and potentially see more money when filing their 2025 taxes in 2026. While tax rate brackets remain the same, adjustments have been made to income levels for all tax brackets with the exception of the top tax rate (37%).
To see how your tax rate may be affected, please view the adjusted tax brackets below comparing tax years 2024 to 2025:
| 2024 Single Filer | Tax Bracket | 2025 Single Filer |
|---|---|---|
| $626,351+ | 37% | $626,351+ |
| $243,726 to $609,350 | 35% | $250,526 to $626,350 |
| $191,951 to $243,725 | 32% | $197,301 to $250,525 |
| $100,526 to $191,950 | 24% | $103,351 to $197,300 |
| $47,151 to $100,525 | 22% | $48,476 to $103,350 |
| $11,601 to $47,150 | 12% | $11,926 to $48,475 |
| $11,600 or less | 10% | $0 to $11,925 |
2024 Married Filing Jointlyor Qualifying Widow | Tax Bracket | 2025 Married Filing Jointly or Qualifying Widow |
|---|---|---|
| $731,201+ | 37% | $751,601+ |
| $487,451 to $731,200 | 35% | $501,051 to $751,600 |
| $383,901 to $487,450 | 32% | $394,601 to $501,050 |
| $201,051 to $383,900 | 24% | $206,701 to $394,600 |
| $94,301 to $201,050 | 22% | $96,951 to $206,700 |
| $23,201 to $94,300 | 12% | $23,851 to $96,950 |
| $0 to $23,200 | 10% | $0 to $23,850 |
2024 Married Filing Separately | Tax Bracket | 2025 Married Filing Separately |
|---|---|---|
| $365,601+ | 37% | $375,801+ |
| $243,726 to $365,600 | 35% | $250,526 to $375,800 |
| $191,951 to $243,725 | 32% | $197,301 to $250,525 |
| $100,526 to $191,950 | 24% | $103,351 to $197,300 |
| $47,151 to $100,525 | 22% | $48,476 to $103,350 |
| $11,601 to $47,150 | 12% | $11,926 to $48,475 |
| $0 to $11,600 | 10% | $0 to $11,925 |
Standard Deductions for 2025 Tax Year
The IRS has also increased standard deductions for both single taxpayers and those married and filing separately for the 2025 tax year.
Standard Deductions for Single Filer & Married Couples Filing Separately
2024 Standard Deductions | 2025 Standard Deductions | Change YoY |
|---|---|---|
| $14,600 | $15,000 | +$400 |
Standard Deductions for Married Couples Filing Jointly
2024 Standard Deductions | 2025 Standard Deductions | Change YoY |
|---|---|---|
| $29,200 | $30,000 | +$800 |
Standard Deductions for Head of Household
| 2024 Standard Deductions | 2025 Standard Deductions | Change YoY |
|---|---|---|
| $21,900 | $22,500 | +$600 |
Why It Matters
Factoring in these adjustments will provide much needed insight to project tax liabilities for simplistic calculations moving into 2025. Effectively planning for this will help maximize deductions and reduce tax liability.