The IRS has released the changes to federal income tax brackets for 2024. Each year, Tax Brackets, Standard Deductions, and Annual Gift Exclusions are adjusted for inflation, as well as many other IRS tax provisions. All investment and financial planning advice that I give takes taxes into consideration.
2024 Federal Income Tax Brackets
Keep in mind that these tax rates are for federal income only. State and local taxes are not included in these numbers.
| Tax Rate | Singles | Married Filing Jointly | Head of Household |
|---|---|---|---|
| 10% | $0 to $11,600 | $0 to $23,200 | $0 to $16,500 |
| 12% | $11,600 to $47,150 | $23,200 to $94,300 | $16,550 to $63,100 |
| 22% | $47,150 to $100,525 | $94,300 to $201,050 | $63,100 to $100,500 |
| 24% | $100,525 to $191,950 | $201,050 to $383,900 | $100,500 to $191,950 |
| 32% | $191,950 to $243,725 | $383,900 to $487,450 | $191,950 to $243,700 |
| 35% | $243,725 to $609,350 | $487,450 to $731,200 | $243,700 to $609,350 |
| 37% | $609,350 and up | $731,200 and up | $609,350 and up |
Standard Deduction
The standard deduction for 2024 will increase. For joint filers, the deduction will increase by $1,500. For single filers, that increase is $750. For those 65 and older, there is an additional standard deduction of $1,550 for joint filers and $1,950 for single filers.
| Filing Status | Deduction Amount |
|---|---|
| Single | $14,600 |
| Married Filing Jointly | $29,200 |
| Head of Household | $21,900 |
Annual Gift Exclusion
The Annual Gift Exclusion for 2024 is $18,000, up from $17,000 in 2023. This means that the first $18,000 that you gift to anybody is excluded from taxes. Gifts above that amount can be given, but anything above $18,000 per person would be applied to the Lifetime Exclusion of the person giving the gift. These amounts are per person, so a married couple can give $36,000 to anybody, free of taxes. The Lifetime Exclusion for 2024 is $13,610,000 per person in 2024.
