The seven federal tax rates remain the same next year, but the amounts of income that fall into each tax bracket will increase a bit.
The 2015 income tax brackets were among more than 40 tax provisions that will change thanks to inflation, according to an announcement by the Internal Revenue Service.
Same tax rates, wider brackets
The biggie is the annual change to just how much money falls into each income tax bracket.
You can earn a little more next year before being bumped into a higher tax bracket. The increases apply across the board to all the rates, from 10 percent to 39.6 percent.
The top tax rate of 39.6 percent will affect single taxpayers in 2015 when their income exceeds $413,200. The top tax bracket kicks in for married taxpayers filing a joint return when their combined incomes come to more than $464,850.
The complete tax bracket amounts in 2015 are:
|Tax rate||Single filers||Married filing jointly or
|Married filing separately||Head of household|
|Tax rate: 10%||Single filers: Up to $9,225||Married filing jointly or qualifying widow/widower: Up to $18,450||Married filing separately: Up to $9,225||Head of household: Up to $13,150|
|Tax rate: 15%||Single filers: $9,226 to $37,450||Married filing jointly or qualifying widow/widower: $18,451 to $74,900||Married filing separately: $9,226 to $37,450||Head of household: $13,151 to $50,200|
|Tax rate: 25%||Single filers: $37,451 to $90,750||Married filing jointly or qualifying widow/widower: $74,901 to $151,200||Married filing separately: $37,451 to $75,600||Head of household: $50,201 to $129,600|
|Tax rate: 28%||Single filers: $90,751 to $189,300||Married filing jointly or qualifying widow/widower: $151,201 to $230,450||Married filing separately: $75,601 to $115,225||Head of household: $129,601 to $209,850|
|Tax rate: 33%||Single filers: $189,301 to $411,500||Married filing jointly or qualifying widow/widower: $230,451 to $411,500||Married filing separately: $115,226 to $205,750||Head of household: $209,851 to $411,500|
|Tax rate: 35%||Single filers: $411,501 to $413,200||Married filing jointly or qualifying widow/widower: $411,501 to $464,850||Married filing separately: $205,751 to $232,425||Head of household: $411,501 to $439,000|
|Tax rate: 39.6%||Single filers: $413,201 or more||Married filing jointly or qualifying widow/widower: $464,851 or more||Married filing separately: $232,426 or more||Head of household: $439,001 or more|
Exemption tweaks, too
The personal exemption for tax year 2015 rises to $4,000. That’s a $50 increase from the 2014 exemption of $3,950.
Each taxpayer can claim a personal exemption, along with one for a spouse and all eligible dependents.
Note, however, wealthier taxpayers might see a reduction in the exemption amount. It begins phasing out when adjusted gross income reaches $258,250 for single filers, $309,900 for married couples filing jointly. Taxpayers lose the personal exemption completely when their income hits $380,750 if single, $432,400 if married filing jointly.
Larger standard deduction amounts
Most taxpayers claim the standard deduction. They will be pleased to learn that in 2015 that amount, which is different for each filing status, also will increase.
The standard deduction rises to $6,300 for singles and married persons filing separate returns and $12,600 for married couples filing jointly. It increases to $9,250 for heads of household.
Estate exclusion increases
When it comes to the ultimate intersection of death and taxes, inflation helps out, too.
For estates left during 2015, the basic exclusion amount is $5.43 million. If the estate is worth that much or less, then no federal estate tax is owed.
More tax info from Bankrate
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Veteran contributing editor Kay Bell is the author of the book “The Truth About Paying Fewer Taxes” and co-author of the e-book “Future Millionaires’ Guidebook.”