Tax Bracket
What is Tax Bracket?
A range of income taxed at a particular rate in a progressive tax system.
Understanding Tax Bracket
In a progressive system like U.S. federal income tax, income is divided into brackets, and each slice is taxed at its own rate. Moving into a higher bracket only raises the rate on the income within that bracket.
That is why a raise never lowers your take-home pay because of brackets alone.
In 2026
U.S. federal income tax has seven rates: 10%, 12%, 22%, 24%, 32%, 35% and 37%. The One Big Beautiful Bill Act of 2025 made these rates permanent; the income thresholds for each bracket rise with inflation every year.
For 2026, the 37% rate applies to taxable income above $640,600 for single filers and $768,700 for married couples filing jointly.
Sources
FAQ
Can a raise push me into a higher bracket and lower my pay?
No. Only the extra income in the higher bracket is taxed at the higher rate.