ECONOMY & WORK
MONEY 101
NEWS
PERSONAL FINANCE
NET WORTH
About Us Contact Us Privacy Policy Terms of Use DMCA Opt-out of personalized ads
© Copyright 2023 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.
MARKETREALIST.COM / ECONOMY & WORK

2024 Tax Brackets: Relief for Taxpayers As IRS Adjusts for Inflation, Joint Filers To Benefit More

The IRS annually adjusts the federal income tax bracket and standard deduction and this year, it has provided some relief for people considering inflation.
PUBLISHED FEB 20, 2024
Cover Image Source: Federal tax forms at the offices of the Internal Revenue Service November 1, 2005 | Getty Images | Photo Illustration by Scott Olson
Cover Image Source: Federal tax forms at the offices of the Internal Revenue Service November 1, 2005 | Getty Images | Photo Illustration by Scott Olson

While high inflation has troubled millions of Americans, there is some good news coming the way of taxpayers. This year, several households can look forward to getting a smaller tax bill. The IRS annually adjusts the federal income tax bracket and standard deduction and this year, taking high inflation into account, the IRS has provided some relief for people. While the new rates help individual taxpayers, joint filers (married couples) are set to benefit more from the new changes.



 

The IRS set federal income tax brackets for 2024, with earnings thresholds for each tier moving up by about 5.4% for inflation. The  agency adjusts the tax brackets using a  formula based on the consumer price index, which tracks the costs  goods and services typically bought by consumers across the U.S. While the tax bracket increases are less than 2023, when the brackets shifted higher by about 7.1%, a historic increase, it is still a significant rise that would help out taxpayers.

Tax brackets for single individuals:

10% for incomes of $11,000 or less

12% for incomes greater than $11,600

22% for incomes greater than $47,150

24% for incomes greater than $100,525

32% for incomes greater than $191,950

35% for incomes greater than $243,725

37% for incomes greater than $609,350

Tax brackets for joint filers:

10% for incomes up to $22,000

12% for incomes greater than $22,000

22% for incomes greater than $89,450

24% for incomes greater than $190,750

32% for incomes greater than $364,200

35% for incomes greater than $462,500

37% for incomes greater than $693,750

As the IRS makes tax code changes to account for inflation, it helps prevent "tax bracket creep," which pushes taxpayers into a higher tax bracket, despite inflation impacting their wages and purchasing power.



 

Thus, with the higher brackets, even if taxpayers make more money in 2024, they will not be pushed into a higher tax bracket. The inflation-factored tax code may even push taxpayers into a lower tax bracket allowing an increase in their take-home pay. For instance, in the 2023 tax year, single tax filers will pay 10% on their first $11,000 of taxable income and 12% for incomes above it. However, in 2024, the first $11,600 of taxable income will fall into the 10% tax bracket, allowing $600 of additional income to be taxed at the 10% rate instead of 12% in the current tax year.

Further, the standard deduction is also increasing by 5.4% in 2024. This means that the standard deduction for married couples filing jointly will rise to $29,200, an increase of $1,500 from the current tax year. Single taxpayers  will benefit from a  standard deduction of $14,600, which is up by about $750 from the current tax year. Also, heads of households will have a standard deduction of $21,900, which is an increase of $1,100 from the current tax year, according to CBS News.

 The Internal Revenue Service (IRS) building | Getty Images | Photo by Zach Gibson
The Internal Revenue Service (IRS) building | Getty Images | Photo by Zach Gibson

Taxpayers in most states will have until April 15 2024, to submit their returns or request an extension. This year, the IRS expects to receive more than 128.7 million individual tax returns by the deadline. Also, taxpayers who want to receive their refund within 21 days of filing, must file their return electronically, ensure that it is accurate and complete, and request to receive the refund via direct deposit, the IRS said.

MORE ON MARKET REALIST
The contestant said she worked in hair loss prevention, which Harvey clearly knows nothing about.
7 hours ago
The guest who impulsively picked up the LeRoy Neiman painting had no idea of its significance.
8 hours ago
It was a heartwarming moment on the show, and even Steve Harvey had a big smile on his face.
9 hours ago
The contestant, Talia MacLean could barely hold her emotions after playing a perfect game.
10 hours ago
The guest wanted a six-figure sum for all three rings but Harrison did not even offer half of that.
11 hours ago
The contestant played a fantastic game despite falling behind in the early going.
12 hours ago
Herjavec was the only one who believed that he could make the business go big.
1 day ago
Steve Harvey had never heard of the team the contestant and sadi, and his reaction was priceless.
1 day ago
The contestant made the unusual choice because of a deal she had with a loved one.
2 days ago
The guest had received it from a cousin, who had bought it in Paris during World War II.
2 days ago
It was a fantastic solve for the contestant as the puzzle did not look easy.
2 days ago
Not only was the signature authentic, but also rare, as it was a full autograph on a personal document.
2 days ago
The guest wanted a lot less for the items and was happy to get a some extra cash.
3 days ago
Steve Harvey asked the contestant, Andrea, to demonstrate her answer, and that's exactly what she did.
3 days ago
The co-host revealed one of her hidden talents and fans were left impressed.
3 days ago
The entrepreneur might not have hoped to get so much money but he wasn't going to say no.
3 days ago
"He's got those American Idol dramatics ingrained in him," a fan pointed out on Reddit.
3 days ago
“We finally got our first $75,000 winner in the Ryan Seacrest era!!!” a fan praised.
4 days ago
It is a known fact that the first Barbie doll debuted in March 1959 during an annual toy fair in New York City.
4 days ago
The contestant also won the biggest prize ever in the show's history.
4 days ago