IRS announces new federal income tax brackets for 2027

The IRS has announced new federal income tax brackets and standard deductions for 2027.

In its announcement Thursday, the agency raised the income thresholds for each bracket, which apply to tax year 2027 for returns filed in 2028.

The IRS also increased figures for other key provisions, including long-term capital gains brackets, the estate and gift tax exemption, and eligibility for the earned income tax credit, among others.

For 2027, the top rate of 37% applies to individuals with taxable income above $661,375 and married couples filing jointly earning $793,650 or more.

Here are the federal income tax brackets for 2027:

• 37%: for incomes over $661,375 ($793,650 for married couples filing jointly)
• 35%: for incomes over $264,550 ($529,100 for married couples filing jointly)
• 32%: for incomes over $208,325 ($416,650 for married couples filing jointly)
• 24%: for incomes over $109,125 ($218,250 for married couples filing jointly)
• 22%: for incomes over $52,025 ($104,050 for married couples filing jointly)
• 12%: for incomes over $12,800 ($25,600 for married couples filing jointly)
• 10%: for incomes of $12,800 or less ($25,600 for married couples filing jointly)

Federal income tax brackets show how much you owe on each part of your taxable income, which you calculate by subtracting the greater of the standard or itemized deductions from your adjusted gross income.

The standard deduction will also increase in 2027, rising to $33,200 for married couples filing jointly, up from $32,200 in 2026. Starting in 2027, single filers can claim $16,600, a bump up from $16,100.

The new tax brackets come as Americans wrestle with affordability issues amid the rising cost of housing, groceries, gasoline and other living expenses. 

The consumer price index climbed 3.7% in September 2026 from one year earlier, up from a yearly pace of 3.4% in August, the Bureau of Labor Statistics reported in October.

The U.S. federal income tax system is progressive, which means tax rates increase as earnings rise.

For 2027, the federal brackets include seven income tiers, with rates ranging from 10% to 37%. The tax rates apply to each band of income rather than a flat percentage for all earnings.

The IRS adjusts the income ranges for each tax rate yearly based on the consumer price index.

Your federal tax brackets depend on your filing status, which you choose on your tax return. The options include single, married filing jointly, married filing separately, head of household or qualifying surviving spouse.

You can find your 2025 taxable income on line 15 of your individual federal income tax return, known as Form 1040.