Updated: August 7, 2018

The new tax law has has gone into effect starting January 1, 2018. There are many changes to the U.S. tax code, including the tax brackets and tax rates. Let’s go over the new rates and brackets.

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2018 Income Tax Brackets

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

Previous Income Tax Brackets

Tax RateIndividualsMarried, Filing JointlyMarried, Filling SeparatelyHead of Household
10%Up to $9,525Up to $19,050Up to $9,525Up to $13,600
15%$9,526 to $38,700$19,051 to $77,400$9,525-$38,700$13,600-$51,800
25%$38,701 to $93,700$77,401 to $156,150$38,700-$78,075$51,800-$133,850
28%$93,701 to $195,450$156,151 to $237,951$78,075-$118,975$133,850-$216,700
33%$195,451 to $424,950$237,951 to $424,950$118,975-$212,475$216,700-$424,950
35%$424,951 to $426,700$424,951 to $480,050$212,475-$212,475$424,950-$453,350
39.6%$426,701 or more$480,051 or more$212,475+$453,350+

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What Are the Major Changes to the Tax Rates?

The number of tax brackets remains the same but overall rates have gone down. For example, a married couple making $80,000 will land in the 25 percent tax bracket for their 2017 returns. That same couple will land in the 22 percent bracket for their 2018 tax returns.

Note: The new tax brackets don’t apply to your 2017 tax returns. When you’re filing and paying taxes in April of 2018, you’ll use the 2017 rates. When you’re filing your 2018 taxes by April of 2019, the new rates will apply.

How Should I Use These Tax Brackets?

You can use these tax rates to determine what you owe for the 2018 tax year. You typically file those taxes by April, 2019.

Use these rates for the 2019 tax year, which you’ll file returns for in April 2020.

How to Take Advantage of the New Tax Rates

The same tips apply to the new tax rates as to the old: maximize your tax-advantaged accounts and try to get as many deductions as you are eligible. The new tax law doubles the standard deduction, which may help a lot of you save on taxes.

For those who are self-employed, don’t forget to get the most out of all your business expenses, including mileage. Your miles are worth more in 2018. You may want to try out a mileage tracker for your drives.

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Marin Perez

Marin Perez

Marin is part of the marketing team at MileIQ. He's excited to see how entrepreneurs are using tools like MileIQ and Spend to be more successful. When not working, he's thinking about his next trip.
Marin Perez

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