IRS announces new federal income tax brackets for 2025

[BumRushDaShow]

Source: CNBC

Published Tue, Oct 22 2024 10:00 AM EDT Updated 24 Min Ago


The IRS has announced new federal income tax brackets and standard deductions for 2025.

In its announcement on Tuesday, the agency raised the income thresholds for each bracket, which applies to tax year 2025 for returns filed in 2026.

The top rate of 37% applies to individuals with taxable income above $626,350 and married couples filing jointly earning $751,600 or more for 2025.

The IRS also boosted figures for dozens of other provisions, including long-term capital gains brackets, estate and gift tax exemption and eligibility for the child tax credit, among others.

Read more: https://www.cnbc.com/2024/10/22/irs-2025-federal-income-tax-brackets.html

---

Link to IRS NEWS RELEASE - IRS releases tax inflation adjustments for tax year 2025

[republianmushroom]

1. Don't think I'll ever make it to this bracket.

[Dem2theMax]

2. I'm in the lowest bracket. You know, the poverty one.

I don't ever have to worry about reaching that highest bracket. Unless I were to win the lottery. And I haven't purchased a lottery ticket since the pandemic.

There's one good thing to be said for being poor.
You don't have anything to lose.

[republianmushroom]

3. I do understand what your saying.

[catrose]

6. Freedom's just another word for...

[Dem2theMax]

11. Yep.

The crash of 2008? I had relatives freaking out. They were heavily invested, and lost a lot. I really felt for them. At the same time I sat there feeling perfectly calm myself. Truly, 'nothing left to lose.'

I have never been a money person. That's never been my goal in life. I want a simple life, filled with the things that really matter. I live well below my means, comfortably, because I know what to do.

I suggested to one of my cousins, one who had just lost quite a bit in the market, that all he had to do was change his lifestyle. 'Live within his means.' The look on his face suggested that I had asked him to cut his head off.

He could not comprehend settling for less than the 'very expensive lifestyle he had grown accustomed to.' He said that out loud. Had to hide the reaction on my face. I will never understand people who think having a lot of stuff is an important goal in life. And, the most expensive stuff no doubt.

Can't take it with you when you die.

[GopherGal]

5. My main financial philosophy can be expressed in questions.

1) How expensive is it to save that much money? A certain skepticism is often called for when seeing ads for sales... (if it's BOGO - how much am I paying to BO...)

And, conversely:
2) How much do I need to earn to need to worry about having to pay those taxes? Especially since top tax bracket percentages are only levied on the amount of earnings above $X, it's often a case of "how well do you need to be doing to run into these 'champagne problems'?"

[Igel]

12. Dunno.

My father was a steelworker. Didn't think the promise of the steelworkers' pension held out much promise for him given his sometimes uncannily insightful sense of how things were going. When he refused to retire as the company downsized locally, they offered him, in 1980, a $180k lump-sum disbursement. Using one of the many "inflation calculators" online, in today's devalued currency that's close to $690k.

He lost a sizeable chunk of his retirement to taxes. Even spreading it over 3 years still left a big hole in the amount--which wouldn't have been the case had he got it paid out over his lifetime, which went for another 23 years. (Note that a decade later the company declared bankruptcy, was freed from pension liabilities, and the federal government picked up those liabilities at much reduced payouts).

Sometimes, albeit infrequently, the axe wielded against class enemies strike members of your class.

Note that he may have retired for the lump sum at age 59, but he'd squirreled away enough to contribute as usual to household expenses until he could retire will full social security benefits.

[twodogsbarking]

4. "It could be simpler and fairer."

Retired CPA.

[Javaman]

7. If I ever made what is now considered middle class in this country, I'd be rich. nt

[JustAnotherGen]

8. Wonder what the sundowning

Of the Jobs and Tax Scam of 2017 will impact this?

[BumRushDaShow]

9. In the OP article is this

After 2025, lower taxes enacted by former President Donald Trump will sunset without action from Congress. If the provision expires, the tax brackets will revert to 2017 levels, shifting to 10%, 15%, 25%, 28%, 33%, 35% and 39.6%.

See - they don't want that 37% to go back to the 39.6% rate.

IMHO, it SHOULD go back up to what it was before Raygun screwed with it -

H.R.4242 - Economic Recovery Tax Act of 1981 (top tax rate went from 70% to 50%)

H.R.3838 - Tax Reform Act of 1986 (top tax rate went from 50% to 28%)

[RicROC]

10. Romney: "Corporations are people, my friends"

So, the corporation tax rate should also be 37%.

(although I'd rather go back to the rates of the Eisenhower years)