Get Ready to Keep More of Your Hard-Earned Money in 2024 as IRS Adjusts Tax Brackets Upward
In a welcome revelation for American taxpayers, the IRS has unveiled its tax brackets for 2024, promising a positive impact on paychecks in the coming year. The new tax brackets, set to rise by 5.4% in 2024, bring with them the prospect of reduced tax obligations for a larger segment of the population. Effectively, this upward shift in tax brackets, coupled with an increase in standard deductions, is designed to afford greater economic respite for Americans, shielding more of their income from taxation.
The changes come as a timely response to the persistent challenge of inflation, intended to uphold the purchasing power of citizens in the face of elevated living costs. Notably, the adjustments in tax brackets and standard deductions stand to influence individuals differently based on their income.
Tax brackets 2024 (taxes due April 2025) [Chart from NerdWallet)
|
Tax Rate |
Single |
Married filing jointly |
Married filing separately |
Head of household |
|---|---|---|---|---|
|
10% |
$0 to $11,600. |
$0 to $23,200. |
$0 to $11,600. |
$0 to $16,550. |
|
12% |
$11,601 to $47,150. |
$23,201 to $94,300. |
$11,601 to $47,150. |
$16,551 to $63,100. |
|
22% |
$47,151 to $100,525. |
$94,301 to $201,050. |
$47,151 to $100,525. |
$63,101 to $100,500. |
|
24% |
$100,526 to $191,950. |
$201,051 to $383,900. |
$100,526 to $191,950. |
$100,501 to $191,950. |
|
32% |
$191,951 to $243,725. |
$383,901 to $487,450. |
$191,951 to $243,725. |
$191,951 to $243,700. |
|
35% |
$243,726 to $609,350. |
$487,451 to $731,200. |
$243,726 to $365,600. |
$243,701 to $609,350. |
|
37% |
$609,351 or more. |
$731,201 or more. |
$365,601 or more. |
$609,350 or more. |
READ ALSO: IRS Grants Automatic Relief To Almost 5 Million Taxpayers For 2020 And 2021 Tax Penalties
The standard deduction is set to rise, benefitting married couples filing jointly, individuals, and heads of households. With these changes, many taxpayers can anticipate holding onto a larger portion of their earnings, thereby potentially boosting their disposable income and financial stability.
The year 2024 is poised to bring forth a tangible improvement in the financial landscape for American workers, as the recalibrated tax brackets work in their favor. By allowing individuals and families to retain more of their hard-earned income, the IRS’s move is set to resonate positively across the nation. This robust response to the economic challenges of inflation showcases a proactive approach to protecting the financial interests of taxpayers, setting the stage for a promising start to the new year.
This development underscores the significance of tax policy in addressing economic dynamics, wherein adjustments to tax brackets and deductions carry far-reaching implications for individuals and the broader economy. As the new tax year approaches, many hardworking Americans can look forward to a more favorable financial outlook, thanks to the encouraging changes put forth by the IRS for 2024.
READ ALSO: Navigating Tax Season: 9 Key Reasons You Might Owe Money To The IRS
