Friday, January 26, 2018

New Tax Brackets

Now that tax overhaul is nearly a month old, it is important for taxpayers to understand the new plan. The new tax bill has a significant effect on most Americans at its most basic level, the individual income tax. It is extremely important for all taxpayers to be aware of their tax bracket, which may have changed this year. Please see the charts below for a list of the new tax rates and brackets.

Below is a list of the tax rates associated with specific income brackets resulting from the newly enacted tax reform:

Rate Single Married
10% $0-$9,525 0$-$19,050
12% $9,526-$38,700 $19,051-$77,400
22% $38,701-$82,500 $77,401-$165,001
24% $82,501-$157,500 $165,001-$315,000
32% $157,501-$200,000 $315,001-$400,000
35% $200,001-$500,000 $401,000-$600,000
37% Over $500,000 Over $600,000

In comparison, below is a list of the tax rates associated with specific income brackets prior to the 2018 tax reform:

RateSingleMarried
10%$0-$9,5250$-$19,050
15%$9,526-$38,700$19,051-$77,400
25%$38,701-$93,700$77,401-$156,150
28%$93,701-$195,450$156,151-$237,950
33%$195,451-$424,950$237,951-$424,950
35%$424,951-$426,700$424,951-$480,050
39.60%Over $426,700Over $480,000

Please do not hesitate to contact Morris Law Group should you have any questions about the new tax brackets or the new plan in general.