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Federal income tax brackets for 2019-2020

Everything you need to know about state and federal taxes.

Updated

Fact checked
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Wondering how federal income tax brackets work? The US uses a progressive tax system, where the more you make, the more you pay. But how much you pay depends on your tax filing status. Use the charts below to see how much you’ll owe and explore our top tips for reducing your tax bill.

Single

Married filing separately

Married filing jointly

This bracket includes surviving spouses.

How do tax brackets work?

Contrary to popular belief, being in a tax bracket doesn’t mean you pay that percentage on your total income. The federal government breaks your income up into chunks, and you pay a different tax rate for each chunk.

For example, if you’re a single tax filer for 2019 who made $40,000 a year, you’ll pay a 10% tax on the first $9,700 you made, 12% on the amount ranging from $9,701 to $39,475 and 22% on the amount over $39,475.

Recent changes to tax brackets

Each year the taxable income limits increase slightly due to inflation. But the tax brackets themselves usually stay the same — unless there’s a tax reform, like the Tax Cuts and Jobs Act that passed in 2018.

The Act lowered the federal income tax brackets and increased the income thresholds within each bracket. Now, the highest earners are taxed at a 37% rate instead of a 39.6% rate and you can generally earn more income before you’re pushed into a higher bracket.

State tax brackets

States have the freedom to structure their tax brackets however they want. Some states have a progressive tax rate where the more you make, the more you pay. Others have a flat tax rate and a few don’t have income tax at all.

States with no income tax:

  • Alaska
  • Florida
  • Nevada
  • South Dakota
  • Texas
  • Washington
  • Wyoming

States with a flat-rate tax:

  • Colorado
  • Illinois
  • Indiana
  • Kentucky
  • Massachusetts
  • Michigan
  • North Carolina
  • Pennsylvania
  • Utah

These states have progressive tax rates where the more you make, the more you pay:

  • Alabama
  • Arizona
  • Arkansas
  • California
  • Connecticut
  • Delaware
  • Georgia
  • Hawaii
  • Idaho
  • Iowa
  • West Virginia
  • Kansas
  • Louisiana
  • Maine
  • Maryland
  • Minnesota
  • Mississippi
  • Missouri
  • Montana
  • Nebraska
  • New Jersey
  • Wisconsin
  • New Mexico
  • New York
  • North Dakota
  • Ohio
  • Oklahoma
  • Oregon
  • Rhode Island
  • South Carolina
  • Vermont
  • Virginia
  • Washington, D.C.

How to lower your tax bracket

There are three ways to lower your tax bill: through credits, deductions and tax-deferred savings contributions.

Tax credits

Tax credits lower your tax bill dollar-for-dollar. If you have a $3,000 tax bill but qualify for $1,000 in credits, your bill is reduced to $2,000.

Common tax credits include:

  • Child tax credit
  • Earned income tax credit
  • American opportunity tax credit (education credit)
  • Electric car tax credit
  • Saver’s credit

Tax deductions

Tax deductions lower your taxable income dollar-for-dollar, which could drop you into a lower tax bracket. Common items you can write off on your taxes include charitable contributions, medical expenses, mortgage interest, property taxes, states and local income taxes, business expenses and more.

Want to calculate how much a deduction will save you in taxes? Use your highest income tax bracket as a guide. For example, if your highest tax bracket is 24%, a $1,000 deduction may trim $240 off your tax bill.

Anytime you save money in a taxed-deferred retirement or health savings account, it lowers your taxable income. So, one of the easiest ways to reduce your taxable income is to max out your retirement accounts. For example, if you make $60,000 a year and contribute $19,500 to your 401(k), your taxable income drops to $40,500.

The same goes for HSAs. If you have a high-deductible healthcare plan, open a health savings plan and contribute as much as you can. For 2020, the maximum limit is $3,550 for individual plans and $7,100 for family plans.

Compare tax filing services

Data indicated here is updated regularly
Name Product Federal returns starting price State returns starting price Maximum return guaranteed? Free options available? Photo import of W2? Live chat?
Intuit TurboTax
$60
$50
Yes
Yes
Yes
No
File returns electronically and get taken step by step through the tax-filing process, so that you can receive the fastest refund possible for yourself, and/or your business.
Keeper Tax
Keeper Tax
$89
$89
No
No
No
Yes
Keeper Tax helps people with 1099 income automatically find tax write-offs among their purchases. At tax time, file federal and state directly for $89 or export to file elsewhere for $39.
Liberty Tax
$27.96
$29.95
Yes
No
Yes
Yes
Choose from EZ, Basic, Deluxe, and Premium packages to support the simplest or the most complicated of returns; including business and investments.
TaxAct
$26.95
$49.95
Yes
Yes
Yes
Yes
TaxAct offers downloadable and online tax preparation services for personal, business and enterprise use
TaxSlayer
$17
$39
Yes
Yes
Yes
TaxSlayer offers free federal and state filing for simple returns and $0 federal return to service members filing with a military EIN.
H&R Block
$49.99
$44.99
Yes
Yes
Yes
Yes
File simply and securely with tax software from H&R Block.
FreeTaxUSA
$0
$14.99
Yes
Yes
No
Yes
File federal returns for free and pay $12.95 for state returns with this online tax preparation software.
eSmart tax
$44.95
$36.95
Yes
Yes
No
Yes
Compare tax preparation plans for this software backed by Liberty Tax Service.
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The bottom line

The way our current federal tax system is set up, the more income you earn, the more you pay in taxes. But just because you’re in one tax bracket doesn’t mean all your income is taxed at that rate. Instead, your income is broken up into chunks and you pay a different rate for each one. Regardless of which bracket you fall in, there are proven ways you can lower your tax bill each year thanks to deductions and credits. Wondering which tax deductions you may qualify for? Check out our guide on income tax deductions.

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