What we'll cover
Tax bracket tables for 2023 filing
Ways to get into a lower tax bracket
Standard deductions vs. itemized deductions
Get ready for Tax Day 2024, which will fall on Monday, April 15th. We have what you need to know so you can knock this off your to-do list.
2023 tax rates and brackets
The Internal Revenue Service (IRS) makes adjustments to tax brackets every year, so it's possible yours (based on your 2023 income) will change between this tax year and the next. We're going to cover the tax brackets for 2023 (which are filed in 2024). Of course, your specific situation may not be straightforward, but a tax professional can help you determine your tax bracket.
Read more: Make filing your taxes easier with these four basic steps.
Single filers or married couples filing separately
Tax rate | Federal income tax bracket | Tax owed |
|---|---|---|
10% | $0 to $11,000 | 10% of taxable income |
12% | >$11,000 to $44,725 | $1,100 plus 12% of the amount over $11,000 |
22% | >$44,725 to $95,375 | $5,147 plus 22% of the amount over $44,725 |
24% | >$95,375 to $182,100 | $16,290 plus 24% of the amount over $95,375 |
32% | >$182,100 to $231,250 | $37,104 plus 32% of the amount over $182,100 |
35% | >$231,250 to $578,125 | $52,832 plus 35% of the amount over $231,250 |
37% | >$578,125 | $174,238.25 plus 37% of the amount over $578,125 |
Source: IRS
Married couples filing jointly
Tax rate | Federal income tax bracket | Tax owed |
|---|---|---|
10% | $0 to $22,000 | 10% of taxable income |
12% | >$22,000 to $89,450 | $2,200 plus 12% of the amount over $22,000 |
22% | >$89,450 to $190,750 | $10,294 plus 22% of the amount over $89,450 |
24% | >$190,750 to $364,200 | $32,580 plus 24% of the amount over $190,750 |
32% | >$364,200 to $462,500 | $74,208 plus 32% of the amount over $364,200 |
35% | >$462,500 to $693,750 | $150,664 plus 35% of the amount over $462,500 |
37% | >$693,750 | $186,601.50 plus 37% of the amount over $693,750 |
Source: IRS
Head of household
Tax rate | Federal income tax bracket | Tax owed |
|---|---|---|
10% | $0 to $15,700 | 10% of taxable income |
12% | >$15,700 to $59,850 | $1,570 plus 12% of the amount over $15,700 |
22% | >$59,850 to $95,350 | $6,868 plus 22% of the amount over $59,850 |
24% | >$95,350 to $182,100 | $14,678 plus 24% of the amount over $95,350 |
32% | >$182,100 to $231,250 | $35,498 plus 32% of the amount over $182,100 |
35% | >$231,250 to $578,100 | $51,226 plus 35% of the amount over $231,250 |
37% | >$578,100 | $172,623.50 plus 37% of the amount over $578,100 |
Source: IRS
What tax brackets mean for you
The United States uses a progressive tax system, which means each portion of your income is taxed at a different rate.
Say you are a single filer and you made $60,000 of taxable income in 2023. The first $10,275 will be taxed at the 10% rate, then the amount between $10,275 and $41,775 is taxed at 12%, and the remaining $18,225 is taxed at the 22% rate, as it falls in that bracket. The total tax bill is $8,817, which is about 14.7% of your taxable income — so, even if you fall into the 22% bracket, that doesn't mean you pay 22% of your taxable income.
How to get into a lower tax bracket
Being in a lower tax bracket means owing less money in taxes. When prepping your tax return, it pays to know the difference between tax deductions and credits, and which you're eligible to claim. Working with a tax professional is the best way to find out what credits and deductions you qualify for.
Tax credits
Tax credits directly lower your tax bill. For example, if you owe $1,000 in taxes and qualify for a $1,000 credit, the credit can zero out your tax liability. Some, like the Child Tax Credit, are refundable, meaning if the credit amount exceeds what you owe in taxes, you receive the difference in your refund (conversely, if your income is higher, you may need to repay some or all of the money you received).
Tax deductions
Tax deductions reduce the amount of income that's subject to tax. They can be above-the-line (used to calculate your adjusted gross income (AGI) or below-the-line (deducted after AGI is calculated). Above-the-line deductions include things like Individual Retirement Account (IRA) contributions and student loan interest. Below-the-line deductions are itemized deductions you claim on the Schedule A tax form, which a tax professional can help prepare.
Standard deductions vs. itemized deductions
The standard deduction is a flat dollar amount you deduct based on your filing status. Your tax advisor can help you decide if a standard or itemized deduction is the right choice for your specific situation.
Standard deductions
Filing status | 2023 Tax year |
|---|---|
Single or married, filing separately | $13,850 |
Married, filing jointly or surviving spouses | $27,700 |
Head of household | $20,800 |
Source: IRS
Filing taxes doesn't have to be complicated
Getting your tax return together shouldn't be a hassle. Whether you file on your own or work with a tax professional, staying organized throughout the year is a great way to ensure that the season doesn't sneak up on you. Happy filing!
