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Austin Tax Blog

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What tax bracket are you in?

It’s not just a question about how much tax you pay, it also has to do with the tax laws. The United States tax law states that there are seven different tax brackets for any person who is an individual and filing jointly. There are marginal rates which means that if your income changes one dollar, then your tax bracket will change too. For this year, these rates remain unchanged from last year – meaning that if your income falls into any of these categories then you’ll be paying the same amount of taxes as before.

Tax Rates for 2022:

For tax year 2022, the top tax rate remains 37% for individual single taxpayers with incomes greater than $539,900 ($647,850 for married couples filing jointly).

35%, for incomes over $215,950 ($431,900 for married couples filing jointly);

32% for incomes over $170,050 ($340,100 for married couples filing jointly);

24% for incomes over $89,075 ($178,150 for married couples filing jointly);

22% for incomes over $41,775 ($83,550 for married couples filing jointly);

12% for incomes over $10,275 ($20,550 for married couples filing jointly).

The 10% rate kicks in for earnings of single people with incomes of $10,275 or less ($20,550 for married couples filing jointly). Keep in mind that if you’re married and filing jointly, your tax brackets will be different. For example, the 12% tax bracket increases to $25,200 instead than $13,600.

For tax year 2022, the standard deduction for married couples filing jointly rose to $25900 while it increased by 800 dollars from last year’s amount. Single taxpayers and heads of household will receive a bump in their deductions too with raises ranging anywhere between 400-600 points each!

What does this mean for people who have incomes over $523,600?

They’re still in the 37% tax bracket! Keep in mind that tax brackets are just for reference, and your specific tax situation may be different. You should always speak with an accountant or tax specialist to figure out what you need to do to pay the least amount of taxes possible.

Conclusion:

We can help you find the right accountant or tax specialist for your situation. Contact us today to learn more about our services and how we can help you work towards a successful future!