The US Internal Revenue Service (IRS) has announced new tax brackets for the year 2025. The updated tax brackets will affect individuals and households and are expected to come into effect on January 1, 2025. Here is a breakdown of the new tax brackets and what you need to know.
For single individuals, the tax brackets for 2025 will range from 10% for those earning up to $10,000 to 35% for those earning over $400,000. For married couples filing jointly, the tax brackets will range from 10% for those earning up to $20,000 to 35% for those earning over $450,000. These brackets represent slight increases from the previous year, reflecting inflation and changing economic conditions.
The standard deduction for single individuals will increase to $12,500, while for married couples filing jointly, it will increase to $25,000. Additionally, the personal exemption will be eliminated in 2025, meaning that individuals will no longer be able to deduct a set amount for themselves and their dependents.
It is essential for taxpayers to be aware of the new tax brackets and how they may impact their financial situation. By planning accordingly and taking advantage of deductions and credits, individuals and households can optimize their tax liabilities and potentially save money.
Overall, the new tax brackets for 2025 aim to create a fair and equitable tax system that accounts for changes in the economy and inflation. Taxpayers are advised to consult with a financial advisor or tax professional to ensure they are maximizing their deductions and credits under the new tax regulations.
Source
Photo credit news.google.com