Married couples could owe no federal income tax on their first $33,200 in 2027 — and singles get a $16,600 cushion to help fight bracket creep

To keep pace, the IRS is raising the standard deduction for married couples filing jointly to $33,200, up $1,000 from 2026. Single taxpayers and married individuals filing separately will see their standard deduction rise by $500 to $16,600. Roughly 90% of taxpayers choose the standard deduction over itemizing expenses on their tax returns.

The IRS also adjusted tax bracket income thresholds to account for inflation, though the top tax rate remains capped at 37% for single filers making over $661,375.

Without these annual inflation tweaks, Americans receiving cost-of-living raises could end up pushed into higher tax brackets even if their actual purchasing power hasn’t changed.

Here is a breakdown for the new 2027 tax brackets:

• 37% for incomes over $661,375 ($793,650 for married couples filing jointly)
• 35% for incomes over $264,550 ($529,100 for married couples filing jointly)
• 32% for incomes over $208,325 ($416,650 for married couples filing jointly)
• 24% for incomes over $109,125 ($218,250 for married couples filing jointly)
• 22% for incomes over $52,025 ($104,050 for married couples filing jointly)
• 12% for incomes over $12,800 ($25,600 for married couples filing jointly)

Other key IRS changes for 2027

Aside from higher standard deductions and income tax brackets, the IRS also increased caps for several popular tax credits and exclusions, including the Earned Income Tax Credit (EITC) and Child Tax Credit.

The maximum EITC in 2027 for qualifying taxpayers with three or more children will climb to $8,496 in 2027, up from $8,231 in 2026. The credit targets working low- and middle-income individuals and families who qualify to reduce their tax burden. According to the IRS, about 24 million families claimed $70 billion through the EITC in 2025.

For the Child Tax Credit, the maximum amount for 2027 increased by $100 to $2,300 per eligible child, with the refundable portion rising to $1,800. (If a refundable credit exceeds your total income tax liability, the IRS refunds you the remaining balance.)

Other notable 2027 adjustments cover adoption expenses, medical savings accounts, foreign earned income limits and annual gift exclusions.

What tax relief is available for 2026?

While the Nov. 5 updates apply to returns filed in 2028, taxpayers can still take advantage of several credits and deductions when filing next spring:

• Charitable deductions for non-itemizers: For the first time, taxpayers who take the standard deduction can take away up to $1,000 in charitable donations (2,000 if married and filing jointly), provided donations go to qualified non-profit organizations. Personal gifts to family members do not qualify.
• Senior tax deduction: Seniors age 65 and older can claim a new $6,000 deduction. This benefit phases out once adjusted gross income exceeds $75,000 for single filers or $150,000 for married taxpayers filing jointly.
• Income timing strategy: “If you’re barely over those thresholds, either deferring income or accelerating deductions can help you to maximize this deduction,” says Logan Allec, a CPA and owner of CPA Clarita Group, told Moneywise in September. Allec suggests prepaying 2027 property taxes, paying rental property insurance premiums early or making charitable donations before year-end.
• Auto loan interest deduction: Filers can deduct up to $10,000 in loan interest paid on a new, U.S.-assembled vehicle purchased for personal use, provided the loan originated after Dec. 31, 2024.

The IRS recalculates tax brackets and standard deductions annually to reflect shifts in the cost of living. For comparison, the standard deduction for the 2026 tax year is $16,100 for single filers, up from $15,750 in 2025.