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Understanding 2024-2025 Federal Tax Brackets: What You Need to Know
Navigating federal tax brackets is one of the most important parts of smart tax planning, but it can also be one of the most confusing. Whether you’re an individual, a household, or a business owner, understanding how your income is taxed can help you make better financial decisions throughout the year.
At Yeater & Associates, we take the guesswork out of the process. As a trusted CPA firm offering tax preparation services across Colorado, we help individuals and businesses use this information to reduce stress and plan with purpose. Below is an overview of the 2024 federal income tax brackets that apply to returns filed in 2025.
2024 Federal Tax Brackets
The United States uses a progressive tax system. That means different portions of your income are taxed at different rates. Your marginal tax rate is the highest bracket your income reaches, but your effective tax rate will always be lower since only part of your income is taxed at each rate.
Single Filers
- 10% on income up to $11,600
- 12% on income over $11,600 to $47,150
- 22% on income over $47,150 to $100,525
- 24% on income over $100,525 to $191,950
- 32% on income over $191,950 to $243,725
- 35% on income over $243,725 to $609,350
- 37% on income over $609,350
Married Filing Jointly
- 10% on income up to $23,200
- 12% on income over $23,200 to $94,300
- 22% on income over $94,300 to $201,050
- 24% on income over $201,050 to $383,900
- 32% on income over $383,900 to $487,450
- 35% on income over $487,450 to $731,200
- 37% on income over $731,200
Head of Household
- 10% on income up to $16,550
- 12% on income over $16,550 to $63,100
- 22% on income over $63,100 to $100,500
- 24% on income over $100,500 to $191,950
- 32% on income over $191,950 to $243,700
- 35% on income over $243,700 to $609,350
- 37% on income over $609,350
Understanding Marginal vs. Effective Tax Rates
Your marginal tax rate is the rate you pay on your last dollar earned. Your effective tax rate is the average rate you pay across all your taxable income. Here’s an example for a single filer making $50,000:
- $11,600 taxed at 10% = $1,160
- $35,550 taxed at 12% = $4,266
- $2,850 taxed at 22% = $627
- Total tax = $6,053
- Effective tax rate = 12.1%
This distinction matters for planning ahead, especially if you’re considering income timing, deductions, or retirement contributions.
Let Yeater & Associates Help You Plan Ahead
If you are unsure how these federal tax brackets impact your situation, or if you want to make strategic moves to reduce your taxable income, we are here to help. Whether you need personal tax preparation services or year-round support for small business accounting, Yeater & Associates can walk you through your options.
We stay current on the latest tax laws so you don’t have to. Contact our team today for help building a tax strategy that works for your life or your business.
