What Is My Tax Bracket?02/05/2020
Generally speaking, the Tax Cuts and Jobs Act(TCJA) reduced individual tax rates through 2025, however, there’s no guarantee that you’ll have lower tax bill or a hefty refund this year. Some people are actually paying more taxes due to reductions or eliminations of certain tax breaks. For this reason, and many more, it’s important to know your bracket.
Some single and head of household filers could be pushed into higher tax brackets more quickly than was the case pre-TCJA. For example, the beginning of the 32% bracket for singles for 2019 is $160,725, whereas it was $191,651 for 2017 (though the rate was 33% then). For heads of households, the beginning of this bracket has decreased even more significantly, to $160,700 for 2019 from $212,501 for 2017.
Married taxpayers, on the other hand, won’t be pushed into some middle brackets until much higher income levels through 2025. For example, the beginning of the 32% bracket for joint filers for 2019 is $321,450, whereas it was $233,351 for 2017. (Again, the rate was 33% then.)
Since tax brackets are adjusted annually for inflation, and there are so many variables under the law, it’s hard to say exactly how a specific taxpayer’s bracket might change from year to year. Contact us for help determining your tax rate for 2020 so we can plan for it and make adjustments to lower your tax burden throughout the year.