U.S. currency and a 1040 tax form

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The IRS has announced the 2017 federal tax brackets, and as usual, the income thresholds have increased slightly from the previous year. Your bracket will depend on your income, current marital status, and whether you choose to file a joint or separate tax return. Here's a guide for determining the baseline for the tax bill you'll be calculating come 2018.

The 2017 tax brackets

Tax brackets are also known as marginal tax rates because they represent the rate you owe on your highest dollar of income. For example, the 10% tax bracket for single filers applies to your first $9,325 in taxable income for 2017. If you're a single filer, you'll only owe 10% on that portion of earnings, no matter how much you make overall.

The 2017 tax brackets are the tax rates you'll pay on income earned in that calendar year, based on the tax return you'll file in 2018. For the return you'll file in 2017, you should refer to the 2016 tax brackets, which can be found here. The slight year-over-year increases are based on inflation as measured by growth in the Consumer Price Index.

There are seven IRS tax brackets and four filing statuses. Here are the details about them, along with a quick way to calculate your baseline tax bill. Be aware that while there are some fractional dollar amounts in these charts, the IRS allows you to round your final calculated tax to the nearest whole dollar amount.

Single filers

Tax Bracket

Income Range

Your Tax Is...

10%

$0-$9,325

10% of your taxable income

15%

$9,326-$37,950

$932.50 plus 15% of your income above $9,325

25%

$37,951-$91,900

$5,226.25 plus 25% of your income above $37,950

28%

$91,901-$191,650

$18,713.75 plus 28% of your income above $91,900

33%

$191,651-$416,700

$46,643.75 plus 33% of your income above $191,650

35%

$416,701-$418,400

$120,910.25 plus 35% of your income above $416,700

39.6%

$418,401 and above

$121,505.25 plus 39.6% of your income above $418,400

Source: Author. Data from IRS.

Married filing jointly

Tax Bracket

Income Range

Your Tax Is...

10%

$0-$18,650

10% of your taxable income

15%

$18,651-$75,900

$1,865 plus 15% of your income above $18,650

25%

$75,901-$153,100

$10,452.50 plus 25% of your income above $75,900

28%

$153,101-$233,350

$29,752.50 plus 28% of your income above $153,100

33%

$233,351-$416,700

$52,222.50 plus 33% of your income above $233,350

35%

$416,701-$470,700

$112,728 plus 35% of your income above $416,700

39.6%

$470,701 and above

$131,628 plus 39.6% of your income above $470,700

Source: Author. Data from IRS.

Married filing separately

Tax Bracket

Income Range

Your Tax Is...

10%

$0-$9,325

10% of your taxable income

15%

$9,326-$37,950

$932.50 plus 15% of your income above $9,325

25%

$37,951-$76,550

$5,226.25 plus 25% of your income above $37,950

28%

$76,551-$116,675

$14,876.25 plus 28% of your income above $76,550

33%

$116,676-$208,350

$26,111.25 plus 33% of your income above $116,675

35%

$208,351-$235,350

$56,364 plus 35% of your income above $208,350

39.6%

$235,351 and above

$65,814 plus 39.6% of your income above $235,350

Source: Author. Data from IRS.

Head of household 

Tax Bracket

Income Range

Your Tax Is...

10%

$0-$13,350

10% of your taxable income

15%

$13,351-$50,800

$1,335 plus 15% of your income above $13,350

25%

$50,801-$131,200

$6,952.50 plus 25% of your income above $50,800

28%

$131,201-$212,500

$27,052.50 plus 28% of your income above $131,200

33%

$212,501-$416,700

$49,816.50 plus 33% of your income above $212,500

35%

$416,701-$444,550

$117,202.50 plus 35% of your income above $416,700

39.6%

$444,551 and above

$126,950 plus 39.6% of your income above $444,550

Source: Author. Data from IRS.

Standard deduction and personal exemptions

Like the tax brackets, the standard deduction will increase slightly in 2017 to $6,350 for singles and married taxpayers filing separately, and to $12,700 and $9,350 for married filing jointly and head of household filing statuses, respectively. If a taxpayer can be claimed as a dependent by another taxpayer, their standard deduction is the lesser of $1,050 or $350 plus their earned income, capped by the standard deductions discussed earlier in this section.

The personal exemption is $4,050 for 2017, and is unchanged from 2016. For higher-income individuals, the personal exemption begins to phase out, and eventually disappears completely above a certain income threshold.

Filing Status

Personal exemption begins to phase out above...

Personal exemption disappears above...

Single

$261,500

$384,000

Married filing jointly

$313,800

$436,300

Head of household

$287,650

$410,150

Married filing separately

$156,900

$218,150

Source: Author. Data from IRS.

Could these tax brackets change in 2017?

It's also important to mention that these tax brackets, standard deductions, and personal exemptions could change dramatically under President-elect Donald Trump's administration. It is unclear whether Trump aims to make changes that will take effect in the 2017 tax year, but here are some of the major personal tax changes he proposed during his campaign:

  • Decrease the seven tax brackets to three, with rates of 12%, 25%, and 33%.
  • Eliminate the head of household filing status.
  • More than double the standard deductions, while eliminating the personal exemption.
  • Expand tax benefits for child care.

To put it mildly, 2017 could turn out to be an interesting year for the American taxpayer.

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