2020’s Federal Tax Rates and Income Brackets were released last week by the IRS. These will impact the rates for 2020 tax return filings, to be filed in 2021.
Oh I do love it when the new tax income brackets come out, it feels like a mini pay raise 🙂 … well until the crunch of inflation comes along and munches it all up… regardless, below are some highlights of the updates to the 2020 Federal Tax Rates & Income Brackets, Standard Deduction, and more:
The 2020 Federal tax rates of 10%-37% have remained the same, however the Income brackets have changed from 2019 depending on your income and filing status as follows:
For married individuals filing jointly:
10%: Taxable income up to $19,750
12%: Income between $19,750 to $80,250
22%: Income between $80,250 to $171,050
24%: Income between $171,050 to $326,600
32%: Income between $326,600 to $414,700
35%: Income between $414,700 to $622,050
37%: Income over $622,050
For unmarried individuals:
10%: Up to $9,875
12%: Income between $9,875 to $40,125
22%: Income between $40,125 to $85,525
24%: Income between $85,525 to $163,300
32%: Income between $163,300 to $207,350
35%: Income between $207,350 to $518,400
37%: Income over $518,400
For heads of households:
10%: Up to $14,100
12%: Income between $14,100 to $53,700
22%: Income between $53,700 to $85,500
24%: Income between $85,500 to $163,300
32%: Income between $163,300 to $207,350
35%: Income between $207,350 to $518,400
37%: Income over $518,400
For married individuals filing separately:
10%: Up to $9,875
12%: Income between $9,875 to $40,125
22%: Income between $40,125 to $85,525
24%: Income between $85,525 to $163,300
32%: Income between $163,300 to $207,350
35% Income between $207,350 to $311,025
37%: Income over $311,025
And here are the standard deduction amounts for 2020:
Married individuals filing jointly: $24,800
Unmarried individuals: $12,400
Heads of households: $18,650
Married individuals filing separately: $12,400
State Individual tax rates and income tax brackets are dependent on the State you are required to file in (if at all). Usually the Individual State Tax Department is best placed to provide you with this information – see here for a useful linked summary table of the State tax Departments.