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.
How it works
A tax bracket is a slice of taxable income taxed at one specific rate, and the US uses seven brackets for 2025 running from 10% up to 37%. For a single filer, the 10% bracket covers taxable income up to $11,925, 12% covers $11,926 to $48,475, 22% covers $48,476 to $103,350, 24% covers $103,351 to $197,300, 32% covers $197,301 to $250,525, 35% covers $250,526 to $626,350, and 37% applies above $626,350. Each filing status has its own version of these breakpoints, generally widest for Married Filing Jointly.
Tax software and the IRS tax tables apply brackets automatically once your taxable income is calculated on Form 1040, but understanding the mechanics helps with planning decisions you make well before filing — like deciding how much to convert to a Roth IRA, how much capital gain to realize, or how large a year-end retirement contribution to make. Because brackets apply to taxable income, not gross income, the actual dollar amount that lands in your top bracket depends heavily on your standard or itemized deduction.
The single biggest misunderstanding about brackets is thinking that crossing into a higher one taxes your entire income at the higher rate — it does not. Only the portion of income that falls inside a given bracket is taxed at that bracket's rate; income in the brackets below is still taxed at those lower rates. This is why a raise or bonus that nudges you into a new bracket rarely reduces your take-home pay overall, even though it can feel that way when withholding on the marginal dollars increases.
Example: taxing $60,000 across brackets
A single filer has $60,000 of taxable income for 2025. The first $11,925 is taxed at 10%, for $1,192.50. The next portion, from $11,926 to $48,475 ($36,550), is taxed at 12%, for $4,386.
The remaining income, from $48,476 up to $60,000 ($11,525), falls in the 22% bracket, adding $2,535.50. Total tax comes to $8,114, even though the filer's top marginal bracket is 22% — the 22% rate never applied to the whole $60,000.
Frequently asked questions
If I move into a higher tax bracket, is all my income taxed at that rate?
How many federal tax brackets are there in 2025?
Do state tax brackets work the same way as federal ones?
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.