Income tax brackets are set to change in 2018 under the Republican tax bill.
- Income tax brackets are set to change in 2018 under the Republican tax bill.
- The bill proposes keeping seven tax brackets, but the income ranges will change.
- It also eliminates the personal exemption and increases the standard deduction.
Congress has passed the massive Republican tax bill.
The bill, called the Tax Cuts and Jobs Act, is heading to President Donald Trump's desk for a signature to enact it, though it's unclear when that will happen.
The bill is set to make sweeping changes to the tax code for businesses and, on average, American taxpayers.
Here's how this new tax plan will change federal income tax brackets in 2018 compared with those in 2017.
First, for single filers:
- 10%: $0 to $9,525 of taxable income for an individual
- 12%: $9,526 to $38,700
- 22%: $38,701 to $82,500
- 24%: $82,501 to $157,500
- 32%: $157,501 to $200,000
- 35%: $200,001 to $500,000
- 37%: over $500,001
And second, for joint filers:
- 10%: $0 to $19,050 for married joint filers
- 12%: $19,051 to $77,400
- 22%: $77,401 to $165,000
- 24%: $165,001 to $315,000
- 32%: $315,001 to $400,000
- 35%: $400,001 to $600,000
- 37%: Over $600,000
Under the final version of the Republican plan, there will still be seven federal income tax brackets — but at slightly lower rates and adjusted income ranges.
About 70% of Americans claim the standard deduction when filing their taxes, and their paychecks will almost certainly increase — albeit slightly.
In 2017, the standard deduction for a single taxpayer is $6,350, plus one personal exemption of $4,050.
The Republican bill combines those into one larger standard deduction for 2018: $12,000 for single filers and $24,000 for joint filers.