Each year, the change of the calendar brings with it new IRS tax brackets. Here’s a look at what you can expect for 2020.
See the New 2020 IRS Tax Rates
It’s as certain as death and taxes every year: The Internal Revenue Service looks at inflation and makes annual adjustments for the coming tax year.
This time around, the IRS website says there have been tweaks to more than 60 tax provisions.
Many of the adjustments aim to prevent what’s called “bracket creep.”
That’s defined as “when people are pushed into higher income tax brackets or have reduced value from credits and deductions due to inflation, instead of any increase in real income,” according to independent tax policy think tank The Tax Foundation.
So with that in mind, here are the new IRS tax brackets for 2020:
|Tax Rate||Single filers, Taxable Income Over||Married Filing Jointly, Taxable Income Over||Head of Household, Taxable Income Over|
(Editor’s note: You can still see the 2019 tax rates here.)
Remember that these income limits will affect the taxes you file in 2021, not the taxes you file in early 2020.
In addition to the new IRS tax brackets and rates, there are some other changes we should note:
- An increase in the standard deduction for 2020 means that number will rise to $12,400 for single filers and $24,800 for joint filers — up year-over-year by $200 and $400, respectively.
- The maximum Earned Income Credit amount for 2020 is going up to $6,660 for taxpayers who have 3+ qualifying children.
- The penalty for failure to file your taxes is increasing to $330 for returns due after the end of 2019. Further inflation adjustments will come beginning with tax year 2021.
You can see the complete list of changes here.