tax bracket
A tax bracket refers to the tax rate applied to a specific range of income. For example, a 12% tax rate may apply to income between certain thresholds. The U.S. federal income tax system is progressive, meaning tax rates increase as income rises. Lower portions of income are taxed at lower rates, while higher portions are taxed at higher rates. This means the bracket rate applies only to income within that bracket, not to a taxpayer’s entire income. If a single filer earns $20,000 of taxable income in 2025, they would pay 10% on the first $11,925 and 12% on the remaining $8,075, not 12% on the full amount.
There are seven federal tax brackets for 2025: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. For single filers, the 10% rate applies up to $11,925, the 12% rate covers $11,926 to $48,475, 22% applies from $48,476 to $103,350, 24% from $103,351 to $197,300, 32% from $197,301 to $250,525, 35% from $250,526 to $626,350, and 37% applies to income above $626,350.
For married couples filing jointly, the bracket thresholds are generally double those for single filers, up to the 35% bracket. The 10% rate applies to income up to $23,850, 12% to $23,851–$96,950, 22% to $96,951–$206,700, 24% to $206,701–$394,600, 32% to $394,601–$501,050, 35% to $501,051–$751,600, and 37% to income above $751,600. Separate filers and heads of household use different thresholds, which are available on the IRS website.
[Last reviewed in July of 2025 by the Wex Definitions Team]
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