Tax Bracket
A range of income taxed at a specific rate. The US uses a progressive system with seven brackets ranging from 10% to 37% for 2025.
A tax bracket is a range of taxable income that is subject to a specific federal income tax rate. For 2025, the seven brackets for single filers are 10% (up to $11,925), 12% ($11,926–$48,475), 22% ($48,476–$103,350), 24% ($103,351–$197,300), 32% ($197,301–$250,525), 35% ($250,526–$626,350), and 37% (over $626,350).
A common misconception is that moving into a higher bracket means all your income is taxed at the higher rate. In reality, only the income within each bracket is taxed at that bracket's rate. This is the progressive or graduated tax system.
For example, a single filer with $60,000 in taxable income in 2025 would pay 10% on the first $11,925, 12% on income from $11,926 to $48,475, and 22% on the remaining income up to $60,000. Understanding brackets helps you plan strategies like Roth conversions, capital gain harvesting, and retirement contributions to stay in lower brackets.
Related Terms
Marginal Tax Rate
The tax rate applied to your last (highest) dollar of taxable income. It indicates how much tax you would pay on an additional dollar of earnings.
Effective Tax Rate
Your total federal income tax divided by your total income, expressed as a percentage. It represents the average rate at which your income is actually taxed.
Taxable Income
The portion of your income that is actually subject to federal income tax, calculated by subtracting the standard or itemized deduction from your AGI.
Filing Status
Your tax classification based on marital and family situation — Single, Married Filing Jointly, Married Filing Separately, Head of Household, or Qualifying Surviving Spouse.
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