The federal income tax has seven brackets, each taxing a slice of your income at a higher rate than the one below it. Bracket thresholds are adjusted for inflation every year. The seven rates, 10%, 12%, 22%, 24%, 32%, 35%, and 37%, were set by the Tax Cuts and Jobs Act of 2017 and were made permanent by the One Big Beautiful Bill Act (P.L. 119-21) signed July 4, 2025. Without that law, they would have reverted to higher pre-2018 levels at the end of 2025.
Your marginal tax rate is the rate on your next dollar of income. Your effective tax rate is the average across all your income. Most people pay a much lower effective rate than their marginal rate because earlier brackets are taxed at lower rates.
2026 brackets for single filers
| Marginal rate | Taxable income |
|---|---|
| 10% | $12,400 or less |
| 12% | Over $12,400 up to $50,400 |
| 22% | Over $50,400 up to $105,700 |
| 24% | Over $105,700 up to $201,775 |
| 32% | Over $201,775 up to $256,225 |
| 35% | Over $256,225 up to $640,600 |
| 37% | Over $640,600 |
2026 brackets for married filing jointly
| Marginal rate | Taxable income |
|---|---|
| 10% | $24,800 or less |
| 12% | Over $24,800 up to $100,800 |
| 22% | Over $100,800 up to $211,400 |
| 24% | Over $211,400 up to $403,550 |
| 32% | Over $403,550 up to $512,450 |
| 35% | Over $512,450 up to $768,700 |
| 37% | Over $768,700 |
For head-of-household and married-filing-separately filers, see IRS Revenue Procedure 2025-XX (to be released; thresholds historically fall between single and MFJ for HOH and equal half of MFJ for MFS).
How the brackets actually apply
People often misunderstand brackets. The assumption is that crossing into a new bracket taxes your entire income at the new rate. It doesn’t.
Take a single filer in 2026 with $80,000 in taxable income (after standard deduction):
| Bracket | Rate | Income in bracket | Tax owed |
|---|---|---|---|
| 10% | $0–$12,400 | $12,400 | $1,240.00 |
| 12% | $12,400–$50,400 | $38,000 | $4,560.00 |
| 22% | $50,400–$80,000 | $29,600 | $6,512.00 |
| Total | $80,000 | $12,312.00 |
That’s an effective tax rate of about 15.4%, even though the top marginal rate is 22%. A common heuristic, “I make $80,000, so I’m in the 22% bracket”, is correct about the bracket but wrong about the rate paid on the whole income.
What “taxable income” actually means
Bracket thresholds apply to your taxable income (your gross income minus deductions). For most filers, the calculation looks like this:
- Total wages, business income, investment income, etc. = gross income
- Subtract above-the-line adjustments (deductible traditional IRA contributions, HSA contributions, student loan interest, self-employed retirement contributions, etc.) = adjusted gross income (AGI)
- Subtract the standard deduction OR itemized deductions = (intermediate)
- Subtract the OBBBA Schedule 1-A deductions (tips, overtime, senior, auto loan interest), if eligible. These reduce taxable income but not AGI = taxable income
- Apply the bracket table above to taxable income
For 2026, the standard deduction is $16,100 (single), $24,150 (head of household), and $32,200 (married filing jointly). Most filers take the standard deduction rather than itemize.
Long-term capital gains and qualified dividends use different brackets
The seven-bracket schedule above applies to ordinary income: wages, interest, short-term capital gains, and retirement-account withdrawals. Long-term capital gains (assets held more than one year) and qualified dividends use a separate, lower set of brackets at 0%, 15%, and 20%. That’s why holding investments for more than a year can dramatically reduce taxes on gains.
What changed in 2026 vs prior years
The rates (10%, 12%, …, 37%) didn’t change. They were going to revert to pre-2018 brackets (10%, 15%, 25%, 28%, 33%, 35%, 39.6%) on January 1, 2026, but the OBBBA made the TCJA rates permanent. Bracket thresholds moved up with inflation as they do every year, so a worker earning the same nominal salary in 2026 as in 2025 typically owes slightly less federal income tax.
Common mistakes
Confusing marginal rate with effective rate. Your top bracket isn’t what you pay on everything you earn.
Forgetting payroll taxes. Federal income tax is one component. FICA (Social Security 6.2% plus Medicare 1.45%, totaling 7.65%) adds to your total federal tax burden and is not affected by the bracket schedule.
Treating brackets as cliff-edges. Earning one extra dollar that pushes you into the next bracket only taxes that one dollar at the higher rate.
Using the wrong filing status. Many filers eligible for head-of-household status accidentally file as single, which uses tighter (less favorable) bracket thresholds.
Next action
Estimate your 2026 taxable income to confirm your top bracket. If you’re near a bracket cliff, tax-deferred retirement contributions (401(k), traditional IRA) and HSA contributions reduce your AGI; the new OBBBA Schedule 1-A deductions (tips, overtime, senior, auto loan interest) reduce taxable income but not AGI, so they help with brackets but not with AGI-based phaseouts elsewhere. Bracket thresholds are inflation-adjusted again for 2027, so plan annually rather than relying on a multi-year fixed table.