IRS tax bracket 2025: This is what you can expect from the new tax brackets

Federal income tax brackets are reportedly expected to increase in 2025, but at lower percentages than in previous years.

Tax brackets are expected to be adjusted 2.8% higher for the 2025 tax year, according to CBS News, which cited an analysis from Bloomberg Tax. The change would be the smallest inflation adjustment in at least three years, following a 5.4% increase in 2024 and a 7.1% increase in 2023, the report showed.

The increase means a single filer earning up to $11,600 in 2024 could earn $11,925 in 2025 before being hit with 10% taxes. According to the CBS analysis, a person paying 24% of their taxable income would see their maximum income before moving to a higher tax bracket increase from $191,950 to $197,300.

The individual tax rates remain the same: 10%, 12%, 22%, 24%, 32%, 35% and 37%.

Tax brackets are determined using a formula based on the Consumer Price Index (CPI), which takes into account the cost of goods and services and increases in inflation. They are adjusted each year to prevent so-called “bracket creep,” which is what happens when inflation pushes taxpayers into higher income tax brackets or reduces the value of credits, deductions and exemptions without increasing real income.

Once published, the new tax rates will apply until 2025 for taxes paid in 2026.

Forbes has other predictions about what taxpayers can expect. You can see more here.