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Tax Rates for the 2012 Tax Year

Federal income tax brackets for 2012

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For 2012 there are six tax rates, and each rate applies to a specific range of income. The income subject to the federal income tax is taxable income, which is total income after various tax deductions have been subtracted.

Federal income tax rates progressively increase as income increases. Instead of just one, flat rate that applies to all income, a person's income will fall into one or more tax rates depending on their income and deductions. For example, a single person with taxable income of $50,000 falls into the 25% tax bracket. (See the single tax rates below.) This "25% tax bracket" means that the person's income from zero to $8,700 is taxed at 10%, and income from $8,700 to $35,350 is taxed at 15%, and finally income from $35,350 to $50,000 is taxed at 25%. The 25% tax rate is this person's marginal tax rate, the tax rate that applies to the last dollars of income earned during the year.

2012 Tax Rates

For 2012, there will be six tax rates of:
  • 10%,
  • 15%,
  • 25%,
  • 28%,
  • 33%, and
  • 35%.
These tax rates are called ordinary rates. Tax rates are called ordinary because these are the tax rates that ordinarily apply to income, unless some special rate applies. There are special tax rates that apply for capital gains, for dividends, for collectibles, and certain types of real estate.

Single Filing Status

[Tax Rate Schedule X, Internal Revenue Code section 1(c)]
  • 10% on taxable income from $0 to $8,700, plus
  • 15% on taxable income over $8,700 to $35,350, plus
  • 25% on taxable income over $35,350 to $85,650, plus
  • 28% on taxable income over $85,650 to $178,650, plus
  • 33% on taxable income over $178,650 to $388,350, plus
  • 35% on taxable income over $388,350.

Married Filing Jointly or Qualifying Widow(er) Filing Status

[Tax Rate Schedule Y-1, Internal Revenue Code section 1(a)]
  • 10% on taxable income from $0 to $17,400, plus
  • 15% on taxable income over $17,400 to $70,700, plus
  • 25% on taxable income over $70,700 to $142,700, plus
  • 28% on taxable income over $142,700 to $217,450, plus
  • 33% on taxable income over $217,450 to $388,350, plus
  • 35% on taxable income over $388,350.

Married Filing Separately Filing Status

[Tax Rate Schedule Y-2, Internal Revenue Code section 1(d)]
  • 10% on taxable income from $0 to $8,700, plus
  • 15% on taxable income over $8,700 to $35,350, plus
  • 25% on taxable income over $35,350 to $71,350, plus
  • 28% on taxable income over $71,350 to $108,725, plus
  • 33% on taxable income over $108,725 to $194,175, plus
  • 35% on taxable income over $194,175.

Head of Household Filing Status

[Tax Rate Schedule Z, Internal Revenue Code section 1(b)]
  • 10% on taxable income from $0 to $12,400, plus
  • 15% on taxable income over $12,400 to $47,350, plus
  • 25% on taxable income over $47,350 to $122,300, plus
  • 28% on taxable income over $122,300 to $198,050, plus
  • 33% on taxable income over $198,050 to $388,350, plus
  • 35% on taxable income over $388,350.

Note: These tax rates are provided for tax planning purposes. To compute your actual income tax, please see the 2012 Instructions for Form 1040 and the 2012 Tax Tables.

How to Use the Tax Rates

Individuals can use the tax rate brackets in a number of ways to calculate the tax cost of additional income during the year or to calculate the tax savings of incurring tax-deductible expenses.

You can use these tax rates to figure out how much federal income tax you will pay on additional income such as tips, bonuses, and interest. For a taxpayer in the 25% tax bracket, for example, extra income will be taxed at the 25% rate until the taxpayer's income reaches the next tax bracket of 28%. An additional dollar of income that falls within the 25% tax bracket will increase federal income tax by 25 cents.

Alternatively, you can use these tax rates to figure out how much federal income tax you will save by increasing your deductions. A taxpayer in the 28% tax bracket, for example, will reduce federal income tax by 28 cents for every dollar spent on a tax-deductible expense, such as mortgage interest or charity.

Be aware that marginal tax rates interact with other tax rates, including the alternative minimum tax, Social Security tax, and Medicare tax rates. In particular, the alternative minimum tax can push income into a higher tax rate or eliminate the tax savings of deductions.

Source: the official tax brackets for 2012 were published by the Internal Revenue Service in Revenue Procedure 2011-52 (21 pages, pdf).

Tax Rates are Changing for 2013

The tax rates for 2013 are scheduled to change as a result of the American Taxpayer Relief Act. There will be a new 39.6% top tax rate following after the 35% rate. Additionally, starting in 2013 there will be a new Medicare surtax of 3.8% on net investment income and 0.9% on wage and self-employment incomes for individuals with incomes over a certain level.
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  1. About.com
  2. Money
  3. Tax Planning: U.S.
  4. File Your Own Taxes
  5. Federal Income Taxes
  6. 2012 Tax Rate Schedules: Marginal Ordinary Income Tax Rates for 2012

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