Federal Tax Brackets for 2012

Tax experts assemble each year, around this time, to envision how the income brackets will look like, by assembling inflation data. This is done so that the tax rates are abreast with the rising inflation. The year 2010 saw some complexity due to the Bush-era tax cuts, but the matter was resolved and 2011 tax brackets showed a slight change from 2010 tax cuts. This time around, all one can see is minor changes in the tax brackets and standard inflation deductions.

2012 Federal Income Tax Brackets

Just like the tax brackets for the year 2011, common federal tax brackets for the year 2012 which have been updated, are divided into four filing categories; viz.,

• Single filers
• Married and filing separately
• Married and filing jointly
• Head of household

The regular deduction provisions, namely the standard and itemized IRS tax deductions list have also not changed much. Compared to last year (when the rise in inflation averaged 1.48%), this time i.e., over the last one year, the rise in inflation averaged 2.43% (higher than 2011); however, this average is still low if we compare the inflation statistics over the past 20 years. Although the tax brackets for 2012 have come up, most citizens are not too worried with the figures until next year. Come April and you will need to look into the tax brackets, if you have to file your 2011 returns.

IRS Tax Brackets: 2012

Apart from the aforementioned minor changes, no significant changes have been mandated. The IRS tax rates and the basic rules for filing and standard deductions have remained the same. For 2012, there will be six tax rates: 10%, 15%, 25%, 28%, 33% and 35%. Here are some tables depicting federal tax brackets for 2012. The first one is for the tax deductions for individuals, which are standardized in nature. They are followed by tables for the current tax rate brackets.

Standardized Tax Deductions

Status	Standard Deduction in $
Tax payers filing as singles (married or unmarried)	$5,950
Married tax payers filing jointly	$11,900
Head of household	$8,700

Unmarried Individuals

Income Amount	Tax Implication and Applicable Rate
more than $0 but not more than $8,700	10% of taxable income
more than $8,700 but not more than $35,350	$870 (+) 15% applicable for amounts exceeding $8,700
more than $35,350 but not more than $85,650	$4,867.50 (+) 25% applicable for amounts exceeding $35,350
more than $85,650 but not more than $178,650	$17,442.50 (+) 28% applicable for amounts exceeding $85,650
more than $178,650 but not more than $388,350	$43,482.50 (+) 33% applicable for amounts exceeding $178,650
more than $388,350	$112,683.50 (+) 35% applicable for amounts exceeding $388,350

Married but Filing Separate Returns

Income Amount	Tax Implication and Applicable Rate
more than $0 but not more than $8,700	10% of taxable income
more than $8,700 but not more than $35,350	$870 (+) 15% applicable for the amounts exceeding $8,700
more than $35,350 but not more than $71,350	$4,867.50 (+) 25% applicable for amounts exceeding $35,350
more than $71,350 but not more than $108,725	$13,867.50 (+) 28% applicable for amounts exceeding $71,350
more than $108,725 but not more than $194,175	$24,332.50 (+) 33% applicable for amounts exceeding $108,725
more than $194,175	$52,531 (+) 35% applicable for amounts exceeding $194,175

Married and Filing Jointly

Income Amount	Tax Implication and Applicable Rate
more than $0 but not more than $17,400	10% of taxable income
more than $17,400 but not more than $70,700	$1,740 (+) 15% applicable for the amounts exceeding $17,400
more than $70,700 but not more than $142,700	$9,735 (+) 25% applicable for amounts exceeding $70,700
more than $142,700 but not more than $217,450	$27,735 (+) 28% applicable for amounts exceeding $142,700
more than $217,450 but not more than $388,350	$48,665 (+) 33% applicable for amounts exceeding $217,450
more than $388,350	$105,062 (+) 35% applicable for amounts exceeding $388,350

Heads of Households

Income Amount	Tax Implication and Applicable Rate
more than $0 but not more than $12,400	10% of taxable income
more than $12,400 but not more than $47,350	$1,240 (+) 15% applicable for the amounts exceeding $12,400
more than $47,350 but not more than $122,300	$6,482.50 (+) 25% applicable for amounts exceeding $47,350
more than $122,300 but not more than $198,050	$25,220 (+) 28% applicable for amounts exceeding $122,300
more than $198,050 but not more than $388,350	$46,430 (+) 33% applicable for amounts exceeding $198,050
more than $388,350	$109,229 (+) 35% applicable for amounts exceeding $388,350

Make sure that you follow all the instructions for Form 1040 schedule A, while filing your income tax return. When in doubt about the income tax brackets, confirm with the IRS website or with the instructions that are attached to your form. The Bush-era tax cuts got a two-year extension which is supposed to cease in 2012; so let's see what lies ahead in 2013 for us.