2021 Federal Tax Brackets & Standard Deduction Amounts (Includes 2018 – 2020 Brackets)

I remember my first (legit) paycheck.

I was working at a restaurant as a banquet waiter earning something around minimum wage in New York in the late 90s. The banquets were only a few years so the paycheck was around $30 a shift. I had probably six shifts a week? So I had expected my first paycheck to be a little over $150 (this place deducted an amount for “food,” assuming you’d eat something there… which was a scam because no one ate anything during their shift, you were too busy!)) but it was just over $100 after withholding and FICA.

That was my lovely introduction to taxes.

What’s always tricky about taxes in the United States is how complicated they are to understand. You have deductions, credits, exemptions, carryovers, … the list goes on and on. Even if you knew every last deduction (and that would make you a tax accountant or a weirdo!), you’d still only know half the story.

Today, we will explain away one piece of the tax puzzle – the federal tax brackets.

The brackets and the deductions (standard and itemized) are the two values that tend to change from year to year. They are not pegged to inflation or cost of living, but the IRS “manually” adjusts them every year to account for them. There are other credits and deductions that automatically change based on the Consumer Price Index released by the Bureau of Labor Statistics.

So how do the tax brackets and deductions work?

Table of Contents
  1. How Federal Tax Brackets Work
  2. 2021 Federal Income Tax Brackets
  3. 2020 Federal Income Tax Brackets
  4. 2019 Federal Income Tax Brackets
  5. Standard Deduction
  6. Personal Exemptions
  7. Single vs. Head of Household
  8. 2018 Federal Tax Rates

How Federal Tax Brackets Work

Federal income tax is a progressive tax system. This means that you are taxed at a higher rate when you earn more.

It’s also a marginal tax system. Every dollar you earn is not taxed the same.

The 100,000th dollar is taxed more than your 1st dollar. And these taxes are assessed on your adjusted gross income. That’s your total income minus deductions.

So when Alexandria Ocasio-Cortez, United States Representative from New York, floated the idea of a top tax bracket of 70%, it doesn’t mean the highest-earning taxpayers will pay 70% on all of their income.

Back in 1944, during World War 2, the top tax bracket was 94% and applied to income over $200,000. Due to inflation, $200,000 in 1944 has the buying power of $2,896,988.51 today. That means you have to earn nearly $2.9 million dollars before you would ever pay a 94% tax rate on a single dollar of income.

In the most recently available income data, only 133,137 households that made over a million dollars. That means the number that earned over $2.9 million is far far less.

Ocasio-Cortez seemed to suggest the top rate would only apply to incomes above $10 million. The number of households who earn that much in a year probably fit inside a classroom.

In October 2020, the IRS released the tax brackets for 2021:

2021 Federal Income Tax Brackets

Here are the federal income tax brackets for 2021 (these apply to income earned in 2021). The brackets are the same, the income figures have been adjusted for inflation:

If you file “Married Filing Separately,” here is your table (broken out due to sizing):

Tax BracketMarried Filing Separately
10%$0 – $9,950
12%$9,951 – $40,525
22%$40,526 – $86,375
24%$86,376 – $164,925
32%$164,926 – $209,425
35%$209,426 – $314,150
37%$314,151+

Here are the brackets for previous years:

2020 Federal Income Tax Brackets

Here are the federal income tax brackets for 2020 (these apply to income earned in 2020). The brackets are the same, the income figures have been adjusted for inflation:

Tax BracketSingleMarried Filing JointlyHead of Household
10%$0 – $9,875$0 – $19,750$0 – $14,100
12%$9,875 – $40,125$19,750 – $80,250$14,100 – $53,700
22%$40,125 – $85,525$80,250 – $171,050$53,700 – $85,500
24%$85,525 – $163,300$171,050 – $326,600$85,500 – $163,300
32%$163,300 – $207,350$326,600 – $414,700$163,300 – $207,350
35%$207,350 – $518,400$414,700 – $622,050$207,350 – $518,400
37%$518,400+$622,050+$518,400+

If you file “Married Filing Separately,” here is your table (broken out due to sizing):

Tax BracketMarried Filing Separately
10%$0 – $9,875
12%$9,875 – $40,125
22%$40,125 – $85,525
24%$85,525 – $163,300
32%$163,300 – $207,350
35%$207,350 – $311,025
37%$311,025+

2019 Federal Income Tax Brackets

Here are the federal income tax brackets for 2019 (these apply to income earned in 2019):

Tax BracketSingleMarried Filing JointlyHead of Household
10%$0 – $9,700$0 – $19,400$0 – $13,850
12%$9,701 – $39,475$19,401 – $78,950$13,851- $52,850
22%$39,476- $84,200$78,950 – $168,400$52,851- $84,200
24%$84,201 – $160,725$168,401 – $321,450$84,201 – $160,700
32%$160,726 – $204,100$321,450 – $408,200$160,701 – $204,100
35%$204,101 – $510,300$408,201 – $612,350$204,101 – $510,300
37%$510,300+$612,351+$510,300+

If you file “Married Filing Separately,” here is your table (broken out due to sizing):

Tax BracketMarried Filing Separately
10%$0 – $9,700
12%$9,701 – $39,475
22%$39,476 – $84,200
24%$84,201- $160,725
32%$160,726 – $204,100
35%$204,101 – $306,175
37%$306,175+

If you’re single and you make $50,000 after subtracting deductions, exemptions, etc; you would pay:

  • 10% on the first $9,700 = $970
  • 12% on the next $29,774 = $3,572.88
  • 22% on the last $10,526 = $2,315.72

You’d pay a total of $6,858.60 in taxes on $50,000 of income, or 13.717%.

Your effective tax rate is just under 14% but you are in the 22% tax bracket. The next dollar you earn is taxed at 22%.

That’s just part one. Not every dollar you earn is actually taxed. 🙂

Standard Deduction

With our tax system, your income is reduced by your deductions. You can take the standard deduction or you can itemize your deductions. When you itemize deductions, you may have to provide proof that you had those expenses. Itemized deductions are things like your mortgage interest, charitable contributions, student loan interest, deductible taxes, and many others.

When you take the standard deduction, you don’t have to do anything. You just take it. The amount is based on your filing status.

Here are the 2021 standard deductions (with 2017 – 2020 figures for reference):

Your Filing Status20212020201920182017
Single$12,550$12,400$12,200$12,000$6,350
Married Filing Jointly$25,100$24,800$24,400$24,000$12,700
Married Filing Separately$12,550$12,400$12,200$12,000$6,350
Head of Household$18,800$18,650$18,350$18,000$9,350

What I always find interesting is when someone says “It’s fine to pay a mortgage because the interest is tax-deductible.” While technically true, it’s not accurate.

To claim an itemized deduction, you would have had to spend money in the first place. You can claim the standard deduction without having to spend a penny.

If you had a choice between paying $10,000 in mortgage interest (deductible) or $10,000 in rent (not deductible), you wouldn’t prefer one over the other. In both cases, you’re paying $10,000 but you’d still claim the standard deduction (assuming no other itemized deductions).

There may be other reasons to carry a mortgage, but taxes isn’t one of them.

Personal Exemptions

In previous years, there was a personal exemption that reduced your income.

It was gone for 2018. And gone for 2019. It’s gone until 2025.

In 2017, that amount was $4,050 and it phased out. Once your AGI peaked $261,500 (or $313,800 for married filing jointly), it would start to phase out. You would claim that exemption for everyone in your family, including dependents. So a family of four would have four personal exemptions.

Since the latest tax law doesn’t expire until 2025, the personal exemption may be gone for a while. This was offset by an increase in the standard deduction, though that is little solace to folks who regularly itemize their deductions.

Single vs. Head of Household

Ever wonder what the difference was between a single filer and a head of household filer? The head of household filing status seems to very much like a single filer except you get a few higher amounts, like an $18,350 standard deduction versus the single filer’s $12,200 deduction.

To be considered the head of household filing status, you must:

  • Pay more than half the household expenses,
  • Be “considered unmarried” for the tax year,
  • Have a qualifying child or dependent.

The first rule is straightforward – you have to pay more than half the household expenses. These include utility bills, mortgage or rent, insurance, groceries, etc.

The second rule is actually slightly trickier. You have to file a separate return from your spouse, pay for more than half the cost of home upkeep, not live with your spouse during the last six months of the tax year, have the qualifying person consider your home as their main home for the last 6 months of the year, and claim that person as a dependent.

Finally, the third rule is the same rules governing qualifying children or dependents throughout tax law.

2018 Federal Tax Rates

These are the federal income tax rates for income earned in 2018, kept for historical purposes:

Tax BracketSingleMarried Filing JointlyHead of Household
10%$0 – $9,525$0 – $19,050$0 – $13,600
12%$9,526 – $38,700$19,051 – $77,400$13,601 – $51,800
22%$38,701 – $82,500$77,401 – $165,000$51,801 – $82,500
24%$82,501 – $157,500$165,001 – $315,000$82,501 – $157,500
32%$157,501 – $200,000$315,001 – $400,000$157,501 – $200,000
35%$200,001 – $500,000$400,001 – $600,000$200,001 – $500,000
37%$500,000+$600,001+$500,000+

If you file “Married Filing Separately,” here is your table (broken out due to sizing):

Tax BracketMarried Filing Separately
10%$0 – $9,525
12%$9,526 – $38,700
22%$38,701 – $82,500
24%$82,501 – $157,500
32%$157,501 – $200,000
35%$200,001 – $300,000
37%$300,000+

Happy tax season and if you’re expecting a refund, remember to file your taxes as soon as possible!

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About Jim Wang

Jim Wang is a thirty-something father of three who is a frequent contributor to Forbes and Vanguard's Blog. He has also been fortunate to have appeared in the New York Times, Baltimore Sun, Entrepreneur, and Marketplace Money.

Jim has a B.S. in Computer Science and Economics from Carnegie Mellon University, an M.S. in Information Technology - Software Engineering from Carnegie Mellon University, as well as a Masters in Business Administration from Johns Hopkins University. His approach to personal finance is that of an engineer, breaking down complex subjects into bite-sized easily understood concepts that you can use in your daily life.

One of his favorite tools (here's my treasure chest of tools,, everything I use) is Personal Capital, which enables him to manage his finances in just 15-minutes each month. They also offer financial planning, such as a Retirement Planning Tool that can tell you if you're on track to retire when you want. It's free.

He is also diversifying his investment portfolio by adding a little bit of real estate. But not rental homes, because he doesn't want a second job, it's diversified small investments in a few commercial properties and a farm in Illinois via AcreTrader.

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  1. Matt says

    “Ocasio-Cortez seemed to suggest the top rate would only apply to incomes above $10 million. The number of households who earn that much in a year probably fit inside a classroom.”

    Until the government decides to slide the scale downward over the years, roping in more and more people; until it comes to our homes – squeezing the middle class out of existence.

    • Jim Wang says

      If you believe that’s what the future will bring if we institute a higher tax rate on high earners, then there’s no convincing you to think otherwise. Best of luck.

    • Dom says

      A classroom in the bay area alone wouldn’t fit all the $10M+ incomes. Maybe not even a school would fit them (just the bay area). Do a little more homework before touting stats like that.

  2. S Awes says

    Am I correct from a reading of your article:
    1) For lower income earners the amount of increase to the standard deduction in 2018 was greater that the 2017 combined sum for standard deduction and the personal exemption in 2017? … a net benefit to these earners?
    2) You suggest the tax advantage of owning a home isn’t a valid criteria in making that choice because of income limits for taking the deduction; however all other criteria / concerns aside (market timing, tornado disaster, etc), it’s certainly a criteria to account for if you have taxable income and are comparing a mortgage to a similar rental payment, right? I guess, I don’t fully understand your criticism here? Obviously the “own vs. buy decision” still has to consider other costs such as maintenance, parking if renting, insurance differences, and PMI, but seems there’s tax benefit are valid also… why suggest otherwise? Appreciate your feedback.

    • Jim Wang says

      1. Yes. The standard deduction in 2018 was $12,000 and the standard deduction in 2017 was $6,350. The personal exemption in 2017 was $4,080.

      2. My point was that the tax advantage of owning a home (and paying interest on a mortgage) was significantly limited by the cap. Depending on how much you pay in interest and property taxes, you may have gotten a much bigger tax deduction before the cap was put in place. Whether you buy or rent, you don’t get a tax benefit for maintenance, parking, or insurance.

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