2025 tax brackets and what they mean for you

Introduction

As we move into a new tax year, understanding the updated 2025 tax brackets can help you plan ahead, avoid surprises, and make smarter financial decisions. Whether you’re an individual filer, a family, or a small business owner in Charlotte or anywhere in the U.S., knowing how these new federal rates work is essential for accurate tax planning.

At TaxPro Consult and Bookkeeping Services LLC, we break down the IRS updates each year so you don’t have to navigate them alone. Below is a simplified guide to the 2025 federal tax brackets and what they mean for your finances.

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First: What are tax brackets, and how do they work?

Tax brackets show how different portions of your income are taxed at different rates.
This does not mean all your income is taxed at the same rate — only the amount that falls into each bracket.

So even if you move into a “higher” bracket, only the income inside that bracket is taxed at that percentage.

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2025 federal income tax brackets

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Single filers

Standard deduction: $15,750

• 10%: $0 – $11,925
  
  
• 12%: $11,925 – $48,475
  
  
• 22%: $48,475 – $103,350
  
  
• 24%: $103,350 – $197,300
  
  
• 32%: $197,300 – $250,525
  
  
• 35%: $250,525 – $626,350
  
  
• 37%: Over $626,350
  
  

Married filing jointly & surviving spouses

Standard deduction: $31,500

• 10%: $0 – $23,850
  
  
• 12%: $23,850 – $96,950
  
  
• 22%: $96,950 – $206,700
  
  
• 24%: $206,700 – $394,600
  
  
• 32%: $394,600 – $501,050
  
  
• 35%: $501,050 – $751,600
  
  
• 37%: Over $751,600
  
  

Married filing separately

Standard deduction: $15,750

• 10%: $0 – $11,925
  
  
• 12%: $11,925 – $48,475
  
  
• 22%: $48,475 – $103,350
  
  
• 24%: $103,350 – $197,300
  
  
• 32%: $197,300 – $250,525
  
  
• 35%: $250,525 – $375,800
  
  
• 37%: Over $375,800
  
  

Head of household

Standard deduction: $23,625

• 10%: $0 – $17,000
  
  
• 12%: $17,000 – $64,850
  
  
• 22%: $64,850 – $103,350
  
  
• 24%: $103,350 – $197,300
  
  
• 32%: $197,300 – $250,500
  
  
• 35%: $250,500 – $626,350
  
  
• 37%: Over $626,350
  
  

Estates & trusts

• 10%: $0 – $3,150
  
  
• 24%: $3,150 – $11,450
  
  
• 35%: $11,450 – $15,650
  
  
• 37%: Over $15,650
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Other key 2025 tax updates

Social Security & Medicare (FICA)

• Social Security tax:
  
  
  • 6.2% for employees
    
    
  • 6.2% for employers
    
    
  • 12.4% for self-employed
    
    
• Maximum taxable earnings: $176,100
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• Medicare tax:
  
  
  • 1.45% employees / 1.45% employers
    
    
  • 2.9% self-employed
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• Additional Medicare tax:
  
  
  • 0.9% on income over $200,000 (single) or $250,000 (married)
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• Net investment income tax:
  
  
  • 3.8% over $200,000 single / $250,000 married
    
    

Business tax updates

• Section 179 expensing limit: $2,500,000
  
  
• Section 179 phase-out threshold: $4,000,000
  
  
• Bonus depreciation: 100% (40% if acquired Jan 1–Jan 18, 2025)
  
  
• QBI (199A) deduction phase-out begins at:
  
  
  • $197,300 single / HOH
    
    
  • $394,600 married filing jointly
    
    

Mileage rates

• Business: 70 cents
  
  
• Medical: 21 cents
  
  
• Moving (military only): 21 cents
  
  
• Charitable: 14 cents
  
  

Family & education updates

• Child Tax Credit: $2,200
  
  
• Kiddie tax threshold: $1,350
  
  
• IRA contributions:
  
  
  • $7,000 (under 50)
    
    
  • $8,000 (50+)
    
    
• SIMPLE IRA:
  
  
  • $16,500 under 50
    
    
  • $20,000 for age 50+ plus $1,750 for ages 60–63
    
    
• SEP IRA: Up to 25% of compensation, max $70,000
  
  
• Education credits:
  
  
  • American Opportunity Credit: $2,500
    
    
  • Lifetime Learning Credit: $2,000
    
    

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What do these tax changes mean for you?

1. Your paycheck may look slightly different

Updated brackets mean your employer may adjust your withholding.

2. Some people will owe less, some more

Your tax bill depends on your income and deductions.

3. Business owners should plan ahead

Changes to Section 179, depreciation, and mileage are important for maximizing deductions.

4. Higher-income earners should review tax strategies

Investment income, Medicare surcharges, and QBI phase-outs may affect planning.

5. Early planning = fewer surprises later

A tax professional can help make sure you’re taking advantage of every benefit.

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Let us help you plan for a smoother 2025 tax season

Whether you're filing as an individual, a family, or a business owner in Charlotte or anywhere in the U.S., our team at TaxPro Consult and Bookkeeping Services LLC is here to help you understand how these tax changes affect you, and how to plan strategically.

Call us today or book your tax planning appointment online to get personalized guidance for the year ahead.

DISCLAIMER: This article is for general education. It is not tax, legal, or accounting advice. Rules change and facts matter. You'll need to consult a qualified tax professional who can look over your specific situation. We are not serving as your tax preparer or tax advisor here.