The Internal Revenue Service announced Nov. 5 that it is adjusting nearly 70 federal tax provisions for inflation for the 2027 tax year. The changes apply to income earned in 2027 and generally will affect tax returns filed in 2028.
The seven federal income tax rates will stay the same: 10%, 12%, 22%, 24%, 32%, 35% and 37%. What changes is how much taxable income falls into each bracket. Taxpayers generally will be able to earn more before a higher marginal rate applies.
The IRS said the thresholds apply to taxable income, not necessarily a person’s total salary or gross income. In the federal progressive tax system, moving into a higher bracket does not mean all income is taxed at the higher rate. Only the income within that bracket is taxed at that rate.
The standard deduction will rise to $33,200 for married couples filing jointly, up $1,000 from 2026. It will rise to $16,600 for single taxpayers and married people filing separately, up $500. Heads of household will have a standard deduction of $24,925, up $775. The standard deduction reduces taxable income for taxpayers who do not itemize deductions.
The maximum child tax credit will increase to $2,300 in 2027, up $100 from 2026. The refundable portion will rise to $1,800, also up $100. The new numbers will not apply to the tax returns Americans file in spring 2027. For families planning their budgets, the key point is timing: these are 2027 tax-year amounts, meant to keep inflation alone from pushing taxpayers into higher brackets.
