IRS unveils new income tax brackets and deductions for 2025

Oct 22

Karah Rucker Reporter

By Karah Rucker (Reporter), Alex Delia (Producer), Jack Henry (Video Editor)

The IRS has announced key tax changes for 2025, including adjustments to income tax brackets, standard deductions, and capital gains rates due to inflation. These updates will affect how much Americans pay in taxes when filing in 2026.

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For income taxes, the top bracket remains at 37%, applying to single filers earning over $626,350 or married couples with income over $751,600.

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The lowest rate, 10%, applies to incomes under $11,925 for individuals and under $23,850 for couples. Meanwhile, standard deductions will increase slightly, with single filers able to claim $15,000 and married couples deducting $30,000. Heads of households will see their deduction rise to $22,500.

The former IRS contractor who leaked former President Donald Trump's tax information was sentenced to five years in prison. — Getty Images

Capital gains tax rates will also be adjusted. Single filers with income up to $48,350 and married couples earning up to $96,700 will continue to qualify for the 0% rate on long-term capital gains.

Additionally, the Earned Income Tax Credit will increase to a maximum of $8,046 for those with three or more children. These changes are designed to provide relief for taxpayers as they face rising inflation.

Tags: child tax credit, EV tax credit, Government funding, Income tax, IRS, Tax cuts, Tax returns, Taxes, taxpayer funds, TurboTax, U.S. Economy

[Karah]

THE IRS ANNOUNCED MAJOR CHANGES TO THE TAX CODE FOR 2025, WITH ADJUSTMENTS AIMED AT HELPING TAXPAYERS KEEP MORE MONEY. THESE UPDATES, DRIVEN BY INFLATION, INCLUDE NEW INCOME TAX BRACKETS, HIGHER STANDARD DEDUCTIONS, AND CHANGES TO CAPITAL GAINS TAX RATES.

IN 2025, THE TOP INCOME TAX RATE OF 37-PERCENT WILL APPLY TO SINGLE FILERS EARNING OVER 626-THOUSAND DOLLARS… AND MARRIED COUPLES FILING JOINTLY WHO MAKE MORE THAN 751-THOUSAND. MEANWHILE, THE LOWEST TAX RATE OF 10-PERCENT WILL APPLY TO INCOME UNDER 12-THOUSAND FOR INDIVIDUALS OR UNDER 24-THOUSAND FOR MARRIED COUPLES.

IN ADDITION, THE STANDARD DEDUCTION WILL RISE FOR ALL TAXPAYERS. SINGLE FILERS CAN NOW CLAIM A 15-THOUSAND DOLLAR DEDUCTION, UP 400 DOLLARS FROM THIS YEAR. MARRIED COUPLES FILING JOINTLY WILL SEE THEIR DEDUCTION INCREASE BY 800, TO 30-THOUSAND DOLLARS, WHILE HEADS OF HOUSEHOLDS CAN DEDUCT MORE THAN 22-THOUSAND..

FOR THOSE WITH INVESTMENTS, THE IRS ALSO MADE ADJUSTMENTS TO CAPITAL GAINS TAX BRACKETS. IN 2025, SINGLE FILERS WITH TAXABLE INCOME UP TO 48-THOUSAND, AND MARRIED COUPLES WITH INCOME UP TO 97-THOUSAND, WILL STILL QUALIFY FOR THE 0-PERCENT LONG-TERM CAPITAL GAINS RATE.

FINALLY, THE EARNED INCOME TAX CREDIT WILL ALSO SEE A BOOST. THE MAXIMUM AMOUNT WILL INCREASE TO MORE THAN 8-THOUSAND FOR TAXPAYERS WITH THREE OR MORE CHILDREN.

THESE CHANGES WON’T AFFECT YOUR TAXES UNTIL YOU FILE IN 2026, BUT THE ADJUSTMENTS SHOULD HELP MANY AMERICANS AS THEY NAVIGATE THE RISING COSTS OF LIVING.

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FOR STRAIGHT ARROW NEWS… I’M KARAH RUCKER.