What Are the New and Improved 2018 Tax Brackets?

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Sometimes, getting a head start on things turns out to be a mistake. In October, the IRS announced what it believed would be the tax brackets for the 2018 tax year, allowing taxpayers to get a chance to do some advance planning for their tax liability in the coming year.

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Yet as it turned out, tax reform made massive changes to the tax laws, including the 2018 tax brackets. Accordingly, below you'll find updated numbers you can use to calculate your taxes this year.

2018 tax brackets for singles

For those who aren't married and can't file as head of household or a qualifying widow or widower, here are the brackets for next year.

Bracket

Tax is this amount plus this percentage

Of the amount over

$0 to $9,525

$0 plus 10%

$0

$9,525 to $38,700

$952.50 plus 12%

$9,525

$38,700 to $82,500

$4,453.50 plus 22%

$38,700

$82,500 to $157,500

$14,089.50 plus 24%

$82,500

$157,500 to $200,000

$32,089.50 plus 32%

$157,500

$200,000 to $500,000

$45,689.50 plus 35%

$200,000

Above $500,000

$150,689.50 plus 37%

$500,000

2018 tax brackets for heads of household

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If you're not married, then you can qualify as head of household if you support a child, parent, or other relative who lives with you more than half the year and meets certain other qualifications. It's often necessary for you to claim qualifying persons as dependents. Heads of household get the wider brackets below, although notice that the upper-income brackets don't provide any additional benefit, which is different from previous law.

Bracket

Tax is this amount plus this percentage

Of the amount over

$0 to $13,600

$0 plus 10%

$0

$13,600 to $51,850

$1,360 plus 12%

$13,600

$51,850 to $82,500

$5,944 plus 22%

$51,850

$82,500 to $157,500

$12,698 plus 24%

$82,500

$157,500 to $200,000

$30,698 plus 32%

$157,500

$200,000 to $500,000

$44,298 plus 35%

$200,000

Above $500,000

$149,298 plus 37%

$500,000

2018 tax brackets for married joint filers

Joint filers will pay the following rates. Note that the marriage penalty has been removed from all but the top two brackets.

Bracket

Tax is this amount plus this percentage

Of the amount over

$0 to $19,050

$0 plus 10%

$0

$19,050 to $77,400

$1,905 plus 12%

$19,050

$77,400 to $165,000

$8,907 plus 22%

$77,400

$165,000 to $315,000

$28,179 plus 24%

$165,000

$315,000 to $400,000

$64,179 plus 32%

$315,000

$400,000 to $600,000

$91,379 plus 35%

$400,000

Above $600,000

$161,379 plus 37%

$600,000

2018 tax brackets for married separate filers

Under tax reform, most of the brackets for those who are married and file separately are the same as for singles. The one difference is that the top bracket starts at $300,000 rather than $600,000.

Bracket

Tax is this amount plus this percentage

Of the amount over

$0 to $9,525

$0 plus 10%

$0

$9,525 to $38,700

$952.50 plus 12%

$9,525

$38,700 to $82,500

$4,453.50 plus 22%

$38,700

$82,500 to $157,500

$14,089.50 plus 24%

$82,500

$157,500 to $200,000

$32,089.50 plus 32%

$157,500

$200,000 to $300,000

$45,689.50 plus 35%

$200,000

Above $300,000

$80,689.50 plus 37%

$300,000

Other changes related to tax reform

One thing to keep in mind is that your taxable income won't be directly comparable in 2018 to what it was in 2017. Even if you made the same amount of gross income, changes to the standard deduction, itemized deductions, personal exemptions, and other key provisions could result in big differences in the number that you'll plug into these brackets to figure your total tax.

In addition, the tax that these brackets produce isn't the endpoint. You also have to figure any credits to which you might be entitled. In some cases, higher credits will offset what would have been higher tax liability under these brackets, producing savings.

If you're planning for your taxes in 2018, these are the brackets you need to get the job done. Make sure you're not using old brackets that are now out of date because they don't reflect tax reform.

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