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Estimated taxable income brackets and rates are now available for the 2015 tax year. Each year, the IRS adjusts more than 40 tax provisions for inflation to prevent “bracket creep”. Bracket creep is what happens when inflation causes taxpayers to be pushed into a higher income tax bracket or have a reduced value from credits or deductions even though they may have had no actual real income increase.
The IRS adjusts income thresholds, deduction amounts and credit values using the Consumer Price Index (CPI) to calculate the past year’s inflation. Yet, in a bit more complicated approach, each tax provision is also adjusted from a specified base year.
In 2015, the standard deduction will increase by $100 to $6,300 for single taxpayers and $200 to $12,600 for married couples filing jointly. The personal exemption for 2015 will be $4,000.
Also in 2015, the highest marginal income tax rate of 39.6% will be levied on single taxpayers whose adjusted gross income is $413,000 and higher and $464,850 and higher for married taxpayers. The remaining federal income tax rates are:
- $0-$9,225 single/$0-$18,450 married – 10%
- $9,225-$37,450 single/$18,450-$74,900 married- 15%
- $37,450-$90,750 single/$74,900-$151,200 married- 25%
- $90,750-$189,300 single/$151,200-$230,450 married- 28%
- $189,300-$411,500 single/$230,450 to $411,500 married- 33%
- $411,500-$413,200 single/$411,500-$464,850 married- 35%
For more information on 2015 federal income tax rates, click here to see the Tax Policy Center’s Tax Facts chart.
Individual state and local income taxes are also complex and vary from state to state. Their 2015 rates are harder to find and calculate. To read more about 2014 state income tax rates, click here to see the latest review by a professional tax information organization.
