November 22, 2020

2020 Income Tax Brackets

2020 Income Tax Brackets be wealthy in smart episode 639 step into a world of wealth and financial freedom without budgets boredom or bosses on be wealthy and smart and now here's your host Lynda, P Jones welcome to be wealthy and smart I'm Lynda P Jones America's wealth mentor empowering women and men, worldwide to financial freedom on today's show we're going to talk about the new income tax brackets for 2020 yes this information just came out breaking news and we. Have some new income tax brackets we have some new. Standard deductions and some other possible itemized deductions including the mortgage interest deduction so we're gonna cover. What is new what tax bracket you might find yourself in and have a little conversation about, that this comes to us from CNBC comm and was written by Alicia Adam SiC and it says the IRS. Released the federal tax rates and income brackets for 2020 on Wednesday the seven tax rates remain unchanged while the income limits have been adjusted for inflation the tax rates in the, US are marginal meaning that different levels of. The same person's income are taxed at different rates if you and your spouse earn $80,000 in, 2020 and are married filing jointly for example the first 19 thousand seven hundred and fifty dollars of that will be taxed at 10% and the income over nineteen. Thousand seven hundred fifty dollars will be taxed at twelve percent the 2020 tax brackets effect the taxes that will be filed in 2021 here are the. New brackets for 2020 depending on your income and filing status, so there's different categories the first thing you want to do is listen. For which category you're in the first category is for married individuals filing jointly the second category is for unmarried individuals the third category is for heads of. Households and the fourth category is for married individuals filing separately one thing I noticed is that married individuals filing jointly really to get a tax break so if. You're considering getting married you might want to speed that up so that you can be in, a lower tax bracket if that works for.

You because there definitely are some tax advantages for being married and filing jointly mainly that if you earn a high income you have a much lower tax bracket so let's talk about. What those tax brackets are for married individuals filing jointly if your taxable income is up to 19 thousand seven hundred, and fifty dollars you're in a ten percent bracket if you're at, 19 thousand seven fifty to eighty thousand two hundred and fifty your brackets only twelve percent, if you make 80 thousand to fifty to a hundred and seventy one thousand fifty you're in the, twenty two percent bracket if you earn one hundred and seventy one thousand fifty dollars to three hundred and twenty six thousand six, hundred dollars you're in the twenty four percent bracket really for that level of income at three hundred twenty six thousand to mean a twenty, four percent bracket is pretty incredible that's very low the next bracket for married individuals filing jointly, is thirty two percent if your income is between three hundred and twenty six. Thousand six hundred and four hundred and fourteen thousand seven hundred if your income is between four hundred and fourteen, seven hundred to six hundred and twenty two thousand fifty you're in the thirty five percent bracket and the highest bracket thirty seven percent are for those married individuals, filing jointly with over six hundred and twenty two thousand and fifty dollars the next category is for unmarried individuals single widowed etcetera you're in the ten percent, bracket if you earn up to nine thousand eight hundred and seventy five dollars for unmarried people with incomes between nine thousand, eight hundred and seventy five dollars to forty, thousand one hundred and twenty five dollars you're in the twelfth percent bracket if you earn between, forty thousand one hundred and twenty-five dollars to eighty-five thousand five twenty five you're in the twenty two percent bracket if you earn eighty five thousand five, twenty five to hundred and sixty three thousand three hundred here in the twenty four percent bracket.

If you earn between one hundred and sixty three thousand three hundred to two hundred and seven three fifty you're in the thirty.

Two percent bracket if you earn two hundred and seven thousand three hundred and fifty to five hundred and eighteen thousand four hundred you're in the thirty five. Percent, bracket and if you make over five hundred and eighteen thousand four hundred you're in the thirty seven percent bracket I think most people are going to fall in either the married. Individuals filing jointly category or the unmarried individuals category however if you are a head of household that's the third, category if you earn up to fourteen thousand one hundred you're in the, ten percent bracket if your income is between fourteen thousand one hundred two fifty three thousand seven hundred, you're in the twelve percent bracket if you have income between fifty three thousand seven hundred to eighty-five thousand five hundred you're in the twenty two percent.

Bracket from eighty-five thousand five hundred to one hundred and sixty three thousand three hundred you'd, be in the twenty four percent bracket at one hundred and sixty three thousand three hundred to two hundred and seven thousand three fifty you'd be in the thirty two percent bracket at. Two hundred and seven thousand three fifty to five hundred and, eighteen thousand four hundred you're in the thirty-five percent bracket and heads of households with income over five hundred and eighteen.

Thousand four hundred dollars are in the thirty seven percent bracket and the final category is for married individuals filing separately if you earn up to, nine thousand eight hundred and, seventy five dollars you're in the ten percent bracket between nine thousand eight hundred and seventy five.

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