Federal Income Tax Brackets and Rates for 2018

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With the Tax Cuts and Job Act now law, taxpayers will see many changes when it comes time to file their 2018 federal income taxes.  The rewrite of the new tax code keeps seven tax brackets, but drops nearly all of the rates.  While the bottom rate remains at 10%, the highest rate falls to 37%, from the 39.6% it was last year. Below are the federal tax brackets and rates you can expect for 2018.

Table for Tax Brackets and Rates for 2018

Rate Unmarried Individuals with Taxable Income Over Married Individuals Filing Jointly  with Taxable Income Over Heads of Households with Taxable Income Over
10% $0 $0 $0
12% $9,525 $19,050 $13,600
22% $38,700 $77,400 $51,800
24% $82,500 $165,000 $82,500
32% $157,500 $315,000 $157,500
35% $200,000 $400,000 $200,000
37% $500,000 $600,000 $500,000

One of the largest changes with the passing of the Tax Cuts and Jobs Act, was the repeal of personal exemptions ($4,050 for yourself, your spouse and each of your dependents) and the significant increase in the standard deduction.  Changes to deductions, including the $10,000 cap on state, local and property tax deductions may make taking the standard deduction more attractive to tax filers than itemizing their deductions.

In 2018 the standard deduction nearly doubles, with an increase of $5,650 for single tax filers and those married filing separately, and an increase of $11,300 for those married filing jointly. The new standard deduction for head of household also nearly doubles increasing $8,650 from last year.

2018 Table for Standard Deduction

Filing Status Deduction
Single $12,000
Married, Filing Jointly $24,000
Head of Household $18,000

With the new tax code personal exemptions are eliminated, but the child tax credit has increased to $2,000 per child under 17 years old and a $500 credit for non-child dependents.  The child tax credit is potentially refundable, with tax filers benefiting from the credit even if they do not have any tax liability (up to $1,400 per child).

You can estimate your 2018 federal tax liability by using our calculator. Also, look further at whether to itemize or take the standard deduction.