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US tax brackets will rise by around 5.4 percent next year in line with inflation, the Internal Revenue Service (IRS) has confirmed. From 2024, the lowest tax rate of 10 percent will apply to those earning up to $11,600, up from $11,000 this year. Meanwhile the highest rate of 37 percent will now apply to workers whose salaries exceed $609,350, up from $578,125 in 2023. Middle-income thresholds all saw similar rises. These higher thresholds could mean savings for millions of workers across all income brackets. They will apply to the 2024 tax year - meaning returns filed in 2025. The...

The IRS on Thursday announced higher inflation adjustments for the 2024 tax year, potentially giving Americans a chance to increase their take-home pay next year. The higher limits for the federal income tax bracket and standard deductions are intended to avoid a phenomenon known as "bracket creep," which happens when taxpayers are pushed into higher-income brackets even though their purchasing power is essentially unchanged due to high inflation. The IRS makes such adjustments annually, but in times of inflation, the increases are more significant and impactful for taxpayers. This year, the tax brackets are shifting higher by about 5.4%. The...

President Donald Trump and his Republican colleagues in both the House and Senate are continuing to work on overhauling the US tax code, and it is now looking increasingly likely that their efforts will be successful. The vote on the final version of the GOP’s tax plan, known as the Tax Cuts and Jobs Act, is expected to happen later this week, with the Republican-controlled House expected to pass the bill on Tuesday before the Senate then votes on the bill either later in the day on Tuesday or Wednesday.

Three brackets, all higher than the current 45 percent We’ve discussed the death tax a fair amount around here, and for better or for worse it usually breaks down to two arguments. Defenders of the tax say there’s no reason the children of rich people should feel entitled to get all their parents’ money, since they themselves did nothing to earn it. Critics of the tax respond by saying that if the parent earned the money, then it should be the parents’ decision who gets it, and at any rate there’s no particular reason the government should have a claim...

Prior to 1981’s Kemp Roth Tax Act, which indexed tax brackets for inflation for the first time, Democrats were happy to watch inflation force taxpayers into higher and higher tax brackets. Bracket creep was the easy way to raise tax rates without putting themselves on record. The experience of the Carter years, with inflation (CPI) rates rising to over 13.5% made indexing a high priority for the incoming Reagan administration. And indexing has worked well. But there are reminders of disastrous consequences of unindexed tax legislation, most notably the Alternative Minimum Tax. The AMT was intended to rectify the problem...

President George W. Bush’s tax cuts are set to expire on December 31st. While Democrats labeled these temporary tax cuts as “only for the rich,” these expiring cuts will drastically impact the middle and lower classes in America. The U.S. Congress should pass an extension of these tax cuts at least for those in the tax brackets below $100,000. The reality of the situation is that 85% of Americans earn less than $100,000 per year, and only 5.5% of Americans earn more than $150,000. I have put together a chart of the current tax rates to compare them with what...