IRS reveals 2027 tax brackets, standard deductions: What to know

( NewsNation ) — The IRS has announced the federal income tax brackets and standard deductions for 2027.

For married couples filing jointly, the standard deduction is increasing by $1,000 to $33,200. Single filers and married couples filing separately will get a $16,600 deduction, up $500 from 2026.

Tax rates aren’t changing, but the income thresholds for each bracket are rising by about 3.2 percent to account for inflation . That means more of your income could be taxed at lower rates.

The IRS said its annual inflation adjustments cover nearly 70 tax provisions for 2027. Those changes generally apply to returns filed in 2028.

The vast majority of taxpayers claim the standard deduction , a fixed dollar amount that reduces your taxable income . When the deduction goes up, it can lower your federal tax bill.

The size of your standard deduction depends on your filing status. Married couples filing jointly get the largest deduction, while single filers and married couples filing separately get the smallest.

Standard deductions are increasing by around 3 percent for each filing status for 2027:

Single; married filing separately : $16,600

Extra deductions for taxpayers 65 and older

Single filers who are 65 or older may claim an additional standard deduction of $2,100. For married couples filing jointly, it’s $1,700 for each qualifying spouse.

The One Big Beautiful Bill Act also created a separate, temporary deduction of up to $6,000 per eligible senior. The deduction begins to phase out when modified adjusted gross income is over $75,000, or $150,000 for joint filers. It expires in 2028.

The federal income tax system is progressive, meaning the tax rate goes up as your taxable income rises.

The seven federal income tax rates are 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37 percent.

When you move into a higher bracket, you pay the higher rate only on the portion of your income that falls within it.

Here’s how the 2027 federal income tax brackets break down by filing status:

Marginal tax brackets for tax year 2027 (Married filing jointly)

Marginal tax brackets for tax year 2027 (Single filers)

Marginal tax brackets for tax year 2027 (Heads of households)

Other changes to earned income tax credit, gift exclusion

Earned Income Tax Credits : The maximum Earned Income Tax Credit for tax year 2027 is $8,496 for qualifying taxpayers who have three or more qualifying children. That’s up from $8,231 for 2026.

The EITC provides support to low-and moderate-income working parents, but many don’t take advantage of it. Find out if you qualify here .

Annual Exclusion for Gifts. The annual exclusion for gifts is increasing to $20,000, up from $19,000 for 2026. The annual exclusion for gifts to a spouse who is not a U.S. citizen is rising to $201,000, up from $194,000.

Child Tax Credit: The maximum amount for 2027 is $2,300, up $100 from 2026. The amount of credit that may be refundable is $1,800, also up $100 from 2026.

Adoption Credits : The maximum credit allowed for qualified adoption expenses is rising by $580 to $18,250 for 2027. Up to $5,280 of that may be refundable.

Estate Tax Exclusion : Estates of decedents who die during 2027 have a basic exclusion amount of $15,480,000, up from a total of $15,000,000 for estates of those who died in 2026.

Foreign Earned Income Exclusion . The foreign earned income exclusion is $137,300 for tax year 2027, up from $132,900 for 2026.