The Internal Revenue Service has (finally!) released the tax brackets for 2024, which are annually indexed for inflation. The top bracket is always the strangest; you would think that the filing joint returns threshold would be double the single filer threshold, as it is for the other brackets, but…Single taxpayers with adjusted gross income of $609,350 will be in the 37% bracket next year, while joint filers making $731,200 or more will fall into that top bracket.
The 35% bracket will start at $243,725 for single filers next year; $487,450 joint; the 32% bracket will kick in at $191,950 (single) or $383,900 (joint); people will enter the 24% bracket starting at $100,525 (single) or $201,050 (joint); and the 22% bracket threshold will be crossed after $47,150 (single) or $94,300 (joint). The 12% bracket will start at $11,600 or $23,200, and anything below that falls into the 10% tax bracket.
The standard deduction will also go up fairly substantially, to $14,600 for single filers; $29,200 for joint filers, with an additional $1,550 or $1,950 for married or unmarried seniors, respectively. People will pay no capital gains taxes on gains realized if their adjusted gross income is below $47,025 (single) or $94,050 (joint); above that, they would pay taxes on their capital gains at a 15% rate until they reach the 20% threshold at $518,900 (single) or $583,750 (joint.)
This article was written by an independent writer for Brewster Financial Planning LLC and is not intended as individualized legal or investment advice.