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2021 and 2022 Federal Income Tax Brackets and Tax Rates

If there’s one topic we doubt you’re planning to bring up at your next dinner party, it’d be federal income tax. Talk about a buzzkill. No one (except tax professionals . . . maybe) likes to think about taxes. But it’s important to know how much you’ll need to shell out during the year to keep Uncle Sam off your back. And how do you figure that out? That’s right, federal income tax brackets and tax rates.

Tax brackets and tax rates rise and fall depending on the year and current tax law, and if you’re like most people, you probably don’t follow them too closely—unless you need help falling asleep at night. But what are tax brackets and tax rates? Let’s take a closer look at what they are and how they change how much you pay in federal income tax.

Tax Brackets vs. Tax Rates

As with most things involving the federal government, the terminology around taxes tends to be more confusing than it needs to be. When you boil it all down, here’s how you tell the difference between tax bracket and tax rate:

  • A tax bracket is a range of income taxed at a specific rate.
  • A tax rate is the actual percentage you’re taxed based on your income.

It’s actually simpler than it sounds.

2021–2022 Federal Income Tax Rates

The 2021 federal income tax rates are the same for income earners as they were in 2020—ranging from 10% to 37%.1 Let’s look at the rates you’ll use to figure out how much income tax you owe Uncle Sam for 2021.

2021 Federal Income Tax Brackets and Rates for Taxable Income

Tax Rate

 Single Filer

Married, Filing Jointly

Married, Filing Separately

Head of Household

10%

$0–9,950

 $0–19,900

$0–9,950

$0–14,200

12%

$9,951–40,525

$19,901–81,050

$9,951–40,525

$14,201–54,200

22%

$40,526–86,375

$81,051–172,750

$40,526–86,375

 $54,201–86,350

24%

$86,376–164,925

$172,751–329,850

$86,376–164,925

$86,351–164,900

32%

$164,926–209,425

$329,851–418,850

$164,926–209,425

$164,901–209,400

35%

$209,426–523,600

$418,851–628,300

$209,426–314,150

$209,401–523,600

37%

Over $523,600

Over $628,300

Over $314,150

Over $523,600

The 2022 federal income tax rates won’t change either.2 What has changed are the income ranges, which have been adjusted for inflation. 

2022 Federal Income Tax Brackets and Rates for Taxable Income

Tax Rate

 Single Filer

Married, Filing Jointly

Married, Filing Separately

Head of Household

10%

$0–10,275

 $0–20,550

$0–10,275

$0–14,650

12%

$10,276–41,775

$20,551–83,550

$10,276–41,775

$14,651–55,900

22%

$41,776–89,075

$83,551–178,150

$41,776–89,075

 $55,901–89,050

24%

$89,076–170,050

$178,151–340,100

$89,076–170,050

$89,051–170,050

32%

$170,051–215,950

$340,101–431,900

$170,051–215,950

$170,051–215,950

35%

$215,951–539,900

$431,901–647,850

$215,951–323,925

$215,951–539,900

37%

Over $539,900

Over $647,850

Over $323,925

Over $539,9003

 How Do Federal Income Tax Rates Work?

Here in the U.S., we have what’s called a progressive tax system. Basically, that means the more money you make, the more you’re going to be taxed on that income.

Taxes shouldn’t be this complicated. Connect with a RamseyTrusted tax advisor.

So, how do you know what rate you’ll be taxed at? This is where tax brackets come in. Your taxable income gets divided into the income ranges—or brackets—we talked about earlier, with each range getting taxed at a certain rate. Remember, your taxable income is your income after you’ve subtracted any deductions, which lower your taxable income.

The good news is that whatever bracket you find yourself in, you don’t have to pay that percentage on your entire income—just the portion that lands in that range. The rest of your income is taxed at the lower rates for each bracket that your income fills up.

Let’s say you’re married filing jointly with $90,000 in taxable income. Roughly the first $20,000 of that income will be taxed in the first bracket. Then the next $60,000 or so will be taxed in the next bracket. Then the next portion will be taxed in the next bracket. You get the idea.

How to Calculate Your 2021 Federal Income Tax

If you’re looking at that table and thinking, What in the world does any of this mean?—don’t worry! The first thing to remember is that the rates on the table only apply to your taxable income. So take out deductions before you start doing the math.

Here’s an example: Let’s say you’re a single filer who made $60,000 this year and are taking the standard deduction of $12,550. You’d first subtract the $12,550 from $60,000, leaving you $47,450 of taxable income. That means only $47,450 is going to be taxed. Yeah, baby!

Now if you give that tax chart another look, you’ll notice $47,450 falls into the 22% bracket. But the whole amount isn’t going to be taxed at 22%—just a portion of it. Here’s how it breaks down:

2021-2022-tax-bracket

2021 Tax Brackets on $47,450 of Taxable Income

Tax Bracket

Taxes Owed

10% Tax Bracket: $0–9,950

$9,950 (.10) = $995

$995

12% Tax Bracket: $9,950–40,525

$40,525 – $9,950 = $30,575

$30,575 (.12) = $3,669

$3,669

22% Tax Bracket: $40,525–86,375

$47,450 – $40,525 = $6,925

$6,925 (.22) = $1,523.50

$1,523.50

Total Taxes Due

$6,187.50


And remember that these are the federal income tax rates. Some states might have either a flat income tax, different tax brackets, or no income tax at all.

Oh, and don’t forget to claim any tax credits you might be eligible for after you find out how much you owe in taxes! Tax credits are extremely valuable, because they lower your tax bill dollar for dollar.

For example, the child tax credit allows taxpayers to claim up to $3,600 per qualified child. So in the scenario above, if you had one child under 6 years old, you could claim that credit and knock your tax bill down to $2,587.50 ($6,187.50 minus $3,600). This is assuming you chose not to receive child tax credit payments in advance in 2021 (this was a temporary option available because of the American Rescue Plan Act of 2021).3

Get Your Taxes Done Right

If the idea of doing all this tax math has you running for the hills, we get it. It can be a lot to figure out. The great news is that you don’t have to crunch the numbers all by yourself. A tax Endorsed Local Provider (ELP) can walk you through the process from beginning to end so you can conquer your taxes with confidence! And that’s definitely something you’ll feel like sharing at your next dinner party.

Find a tax pro today!

Maybe your taxes are simple enough to handle on your own. Great! Say hello to Ramsey SmartTax—the tax software designed with you in mind! With Ramsey SmartTax, you’ll always know right up front how much you owe when you e-file your taxes. No hidden fees, no gimmicks, no games.

Check out Ramsey SmartTax today!

Ramsey Solutions

About the author

Ramsey Solutions

Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

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