The Internal Revenue Service has released the federal income-tax inflation adjustments for tax year 2027, giving workers, families and small-business owners an early look at the thresholds that will apply to income earned next year. The announcement, issued November 5, updates almost 70 tax provisions, including the standard deduction, marginal tax brackets and several credits.

The most important distinction is timing: these are tax-year 2027 figures. In most cases, they apply to income earned during 2027 and to tax returns filed in 2028. They are not the brackets for the 2026 return most people will prepare in early 2027.

2027 standard deduction and federal income-tax brackets

For tax year 2027, the standard deduction rises to $16,600 for single filers and married individuals filing separately, $33,200 for married couples filing jointly and $24,925 for heads of household. The standard deduction reduces the amount of income subject to federal income tax for taxpayers who claim it; it is not a tax credit and it does not mean that the same amount is subtracted directly from the tax bill.

The seven federal marginal tax rates remain 10%, 12%, 22%, 24%, 32%, 35% and 37%. For single filers, the 10% bracket applies to taxable income up to $12,800. The 12% bracket applies above $12,800 through $52,025; 22% applies above $52,025 through $109,125; 24% through $208,325; 32% through $264,550; 35% through $661,375; and 37% applies above that amount.

For married couples filing jointly, the corresponding thresholds are generally higher: 10% up to $25,600; 12% above that through $104,050; 22% through $218,250; 24% through $416,650; 32% through $529,100; 35% through $793,650; and 37% above $793,650. Head-of-household filers have their own thresholds, so they should not use the single-filer table as a substitute.

A marginal tax bracket does not mean that all of a person’s income is taxed at the highest rate they reach. The rate applies only to the portion of taxable income that falls inside that bracket. For example, a single filer with taxable income that crosses into the 22% bracket does not pay 22% on every dollar; the lower portions remain subject to the lower marginal rates.

What the 2027 changes mean for families and workers

The IRS also announced a maximum Child Tax Credit of $2,300 for tax year 2027, with up to $1,800 potentially refundable. Eligibility rules and income limits still matter, so the headline maximum is not a guarantee that every family will receive the full amount. Taxpayers should check the IRS instructions for the year they are filing rather than rely on a general summary.

Other inflation-adjusted provisions include changes to the Alternative Minimum Tax exemption, estate-tax exclusion, annual gift-tax exclusion and business expensing limits. The annual exclusion for gifts rises to $20,000 in calendar year 2027, while the basic estate-tax exclusion for people who die during 2027 is $15.48 million. These provisions will matter more to some households and businesses than others, so the IRS revenue procedure is the authoritative source for the complete list.

The practical step for most workers is to review withholding after the new year, especially if income, filing status, dependents or deductions are changing. A higher standard deduction can reduce taxable income, but it does not automatically mean that a paycheck’s withholding is correct. Self-employed people and households with multiple income sources may also need to revisit estimated tax payments.

Do not change payroll withholding solely because a headline says the standard deduction increased. Compare the new figures with your actual income, filing status and expected credits. If your situation includes business income, investment income, retirement distributions or a major life change, a qualified tax professional can help interpret how the rules apply.

The IRS announcement and full tables are available in IRS Notice IR-2026-133. The Tax Foundation’s 2027 tax-bracket table provides a second reference for comparing filing statuses.

Here is the important practical point: the bracket thresholds apply to taxable income, not simply the gross amount shown on a pay stub. Taxable income is generally calculated after allowable deductions. A person’s final tax bill can also be affected by credits, filing status, additional taxes and other provisions. Two households with the same salary can therefore have different tax outcomes depending on their circumstances.

People who want to prepare should save the IRS announcement, confirm which filing status applies to them and revisit withholding or estimated payments once the 2027 year begins. The IRS Tax Withholding Estimator can help employees compare their expected tax with current paycheck withholding. Self-employed workers should also consider estimated tax payments and recordkeeping rather than waiting until the return is due. These are planning steps, not a substitute for individualized tax advice.

For a broader look at household costs, see our earlier explainer on inflation and the October 2026 CPI report.

Bottom line: The 2027 standard deduction rises to $16,600 for single filers and $33,200 for married couples filing jointly. These numbers apply to tax year 2027, not the 2026 return, and marginal rates apply only to the income inside each bracket.