IRS Raises 2027 Tax Brackets, Standard Deduction Hits $33,200

The IRS rolled out its 2027 federal income tax brackets and standard deductions on Thursday, nudging the income thresholds higher for every tier. The new numbers cover tax year 2027, which means they'll show up on returns filed in 2028. Alongside the brackets, the agency also bumped up long-term capital gains thresholds, the estate and gift tax exemption and eligibility rules for the earned income tax credit.

At the top end, the 37% rate now bites on taxable income above $661,375 for individual filers. For married couples filing jointly, that top rate kicks in at $793,650 or more. The system keeps its seven tiers, with rates stepping from 10% up to 37%.

The standard deduction is climbing too. Married couples filing jointly can claim $33,200, up from $32,200 for 2026. Single filers get $16,600, a bump from $16,100.

The adjustment lands as households keep wrestling with the cost of housing, groceries and gasoline. The consumer price index rose 3.7% in September 2026 compared with a year earlier, the Bureau of Labor Statistics reported in October, up from an annual pace of 3.4% in August.

The IRS recalibrates these income ranges every year using the consumer price index, so the brackets drift upward as inflation does. The math matters because the U.S. system is progressive: each rate applies only to the slice of income inside its band, not to every dollar a filer earns. Where you land depends on your filing status — single, married filing jointly, married filing separately, head of household or qualifying surviving spouse.

To check which bracket you're in, start with taxable income: take your adjusted gross income and subtract the larger of your standard or itemized deductions. Your 2025 taxable income sits on line 15 of Form 1040.