There are no new credits or deductions available for this filing season. However, the IRS has made its annual inflation adjustments for more than 60 tax provisions, including tax rate schedules and the standard deduction.
Without these tweaks, cost-of-living pay raises could push taxpayers into higher tax brackets or reduce the value of their credits, deductions, and exemptions. This so-called “bracket creep” would mean increased income taxes without an increase in inflation-adjusted real income, according to the Tax Foundation.
For example, last filing season the 22% tax bracket for a married couple filing jointly started at $89,450. This filing season, that same couple would have to earn $94,300 ($4,850 more) to fall in the 22% bracket.
2024 Tax Brackets
The IRS raised income thresholds for the seven tax brackets by 2.8 percent, a much smaller increase than last year.
The lowest tax rate is 10 percent for single individuals with incomes of $11,600 or less ($23,200 for married couples filing jointly). The highest rate remains 37 percent for single taxpayers with incomes greater than $609,350 ($731,200 for married couples filing jointly).
Here are the rest of the tax brackets:
- 12% for incomes over $11,600 ($23,200 for married couples filing jointly)
- 22 % for incomes over $47,150 ($94,300 for married couples filing jointly)
- 24% for incomes over $100,525 ($201,050 for married couples filing jointly)
- 32% for incomes over $191,950 ($383,900 for married couples filing jointly)
- 35% for incomes over $243,725 ($487,450 for married couples filing jointly)
Standard Deductions for 2024
Rather than itemize, 90 percent of taxpayers take the standard deduction, a specific dollar amount set by the IRS that reduces the amount of taxable income.
“Most of us are taking the standard deduction because that gives us the best chance to reduce the taxes we pay,” said IRS spokesperson Raphael Tulino. “Remember, you either choose Schedule A—your itemized deductions, which [includes] medical, dental, charitable, your state and local taxes, all those things added up—or you take the standard deduction. The bigger number is the one you want to use to reduce the taxes you pay.”
The standard deductions were also increased this filing season to compensate for inflation.
Married couples filing jointly: The standard deduction is $29,200, up $1,500 from the prior year.
Single taxpayers and married individuals filing separately: The standard deduction increases to $14,600, up $750.
Heads of households: The standard deduction is $21,900, up $1,100.
Taxpayers who are 65 or older or blind at the end of the tax year and don’t itemize are entitled to the standard deduction plus an additional deduction of $1,550, or $1,950 for those who are unmarried and not a surviving spouse.
Note: Those who take the standard deduction cannot deduct charitable contributions.
MORE INFO : Deductions for individuals: The difference between standard and itemized deductions, and what they mean
Tax Credits Can Reduce Tax Burden for Many
A tax credit is a dollar-for-dollar amount eligible taxpayers can claim on their tax return to reduce their tax bill. You must file a tax return to claim these credits.
“Don’t overlook any credits that can help you reduce the tax you pay or increase your refund,” Tulino told Checkbook. “If there’s a benefit that you qualify for, by all means, you should take advantage of it.”
Earned Income Tax Credit: This credit of up to $7,830 for those who have three or more qualifying children, can help low- and moderate-income workers and families (Gross Adjusted Income of $66,819 or less) get a tax break. Those who qualify may receive a refund even if they don’t owe any tax or didn’t have any tax withheld.
Child Tax Credit: Families with qualifying children (dependents younger than 17 at the end of the 2024 tax year) may be able to claim the credit even if they don’t normally file a tax return. The maximum credit is $2,000 per qualifying dependent child.
Adoption Credit: Those who adopted or started the adoption process in 2024 may qualify for the adoption credit. This credit of up to $16,810 in qualified expenses per child can be applied to international, domestic, private, and public foster care adoption.
More Info:
Earned Income Tax Credit (EITC): What It Is and How It Works
Child Tax Credit: Eligibility, How to Claim in 2024-2025
Tax Credits: What They Are and How They Work in 2024-2025
Other Significant Changes for this Filing Season
The IRS made several other adjustments to account for inflation, including:
Alternative Minimum Tax: The new exemption amount is $85,700; it begins to phase out at $609,350. For married couples filing jointly, the exemption is $133,300; it begins to phase out at $1,218,700.
Foreign Earned Income Exclusion: $126,500, up from $120,000 last year.
Estate Taxes: The basic exclusion from federal estate taxes is now $13,610,000, up from $12,920,000, for estates of those who died in 2024.
Gifts: The annual exclusion increased to $18,000, up from $17,000 in the calendar year 2023.
Flexible Spending Accounts: The dollar limitation for employee salary reductions for contributions to health flexible spending accounts (FSA) increased to $3,200.
Visit the IRS website for more info on inflation adjustments for tax year 2024.
Digital Assets
Taxpayers must report all income related to digital assets. According to the IRS, a digital asset is “property that is stored electronically, and can be bought, sold, owned, transferred or traded.” This includes convertible virtual currencies and cryptocurrencies, stablecoins, and non-fungible tokens (NFTs). The 2024 return includes a question that asks if you received, sold, exchanged, or otherwise disposed of a digital asset during the tax year.
Clean Vehicle Credit
If you bought a new or used plug-in electric (EV) or fuel cell vehicle (FCV) in 2024, you might qualify for a Clean Vehicle Tax Credit.
The new vehicle credit of up to $7,500 is limited to certain EV and FCV vehicles made by qualifying manufacturers with final assembly in North America and have batteries that meet requirements for where the critical minerals were sourced and manufacturing occurred. Other restrictions include weight, MSRP, and the taxpayer’s income. The modified adjusted gross income (AGI) cannot exceed $300,000 for married couples filing jointly, $225,000 for heads of household, and $150,000 for all other filers.
The used vehicle credit applies to qualified electric or fuel cell vehicles purchased from a licensed dealer for $25,000 or less. The credit equals 30 percent of the sale price, up to a maximum credit of $4,000.
Important Dates—Some Filing Deadlines Delayed
The 2024 filing season officially starts on January 27; that’s when the IRS will start accepting and processing 2024 tax returns. The IRS Free File service in English and Spanish is already available to those who qualify to use the service.
For most taxpayers, the deadline to file their federal tax return, pay any tax owed, or request an extension to file is Tuesday, April 15, 2025. For those who live in a federally declared disaster area, there may be additional time to file. For example, for individuals and businesses impacted by the wildfires in California, the IRS postponed various deadlines until Oct. 15.
The due dates for taxpayers in other areas hit by natural disasters in 2024 (all or parts of 14 states, Puerto Rico, and the Virgin Islands) who received extensions to file their returns for the calendar year 2023, must file by Feb. 3 or May 1, 2025, depending on location.
Expecting a Refund?
The quickest and best way to get your refund is to file your return electronically and use direct deposit.
In most cases, the IRS says, if there are no errors and the return is complete, you should have your money in less than 21 calendar days.
With direct deposit, you can have your refund sent to as many as three different accounts: a checking or savings account, a prepaid debit card, or a mobile payment app. You’ll need routing and account numbers for those debit cards or payment apps.
The IRS says eight out of 10 taxpayers use direct deposit because it’s “simple, safe, and secure.” This is the same electronic transfer system used to deposit nearly 98 percent of all Social Security and Veterans Affairs benefits into millions of accounts.
The IRS cannot issue refunds before mid-February to taxpayers who claim an Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC). By law, the IRS must hold the entire refund—not just the portion associated with these credits—until the review of that return is complete.
Use the Where’s My Refund? Tool on the IRS website to check on the status of your refund within 24 hours of e-filing. If you file a paper return, this information is usually available within four weeks.
If you wind up owing money, you don’t have to pay until April 15, which may give you time to save up. If you still can’t afford to pay what you owe by then, see if you qualify for an IRS payment plan.
Free Help and Free Filing
IRS Free File is available to individuals or families with an Adjusted Gross Income of $84,000 or less in 2024. This year, eight commercial tax preparation companies (“trusted partners”) are taking part in the program. DO NOT search for “file my taxes for free”—you could end up on the website of a scammer. Instead, use the links provided by the IRS on its Free File page.
Each company participating in the program sets its own eligibility rules based on age, income, and state residency. If you meet a company’s requirements, it cannot charge for the electronic preparation and filing of your federal tax return.
Note: Some IRS Free File trusted partners do charge a fee to prepare state income tax returns. Any state tax preparation or non-qualifying fees must be disclosed upfront on the provider’s IRS Free File landing page.
Unless they obtain your informed and voluntary consent, IRS Free File providers are prohibited from disclosing or using your information for purposes other than preparing your tax return.
The IRS also offers free basic tax return preparation to qualified individuals through its Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs. These programs are available to taxpayers with adjusted gross incomes of less than $67,000, are 60 years and older, have disabilities, or speak limited English. Advisors specialize in pension and retirement issues unique to seniors. At selected sites, taxpayers can input and electronically file their own tax returns with the assistance of an IRS-certified volunteer.
MilTax is a free resource backed by the Department of Defense for service members, eligible family members, survivors, and recent veterans up to 365 days from their separation or retirement date. It includes tax preparation and electronic filing software, as well as personalized support from military tax experts. MilTax is designed to assist with issues involving deployments, combat and training pay, housing, and multi-state filings. Eligible service members (and some veterans) can use MilTax to electronically file a federal tax return and up to three state returns for free.
IRS Expands ‘Direct File’ Program
Launched as a pilot in 12 states last year, Direct File gives low- and moderate-income taxpayers, who take the standard deduction, the option to file their returns directly with the IRS for free.
Similar to commercial software, taxpayers can automatically import data from their IRS account. The service is limited to those with W-2 wages, Social Security benefits, unemployment compensation, interest income, distributions for qualified medical expenses from Health Savings Accounts, or Alaska Permanent Fund Dividends. Gig workers or those with unreported cash income (such as tips or alimony), cannot use Direct File.
Starting Jan. 29, Direct File will be available in 25 states with expanded features, including a chat bot to help guide users through the eligibility requirements in English and Spanish. It will be available this year to more than 30 million taxpayers in Alaska, Arizona, California, Connecticut, Florida, Idaho, Illinois, Kansas, Maine, Maryland, Massachusetts, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, South Dakota, Tennessee, Texas, Washington, Wisconsin, and Wyoming.
Direct File was built by IRS designers, software engineers, and tax experts. All the other options to prepare returns and e-file for free involve third-party companies.
IRS Promises Better Customer Service
The IRS says its ongoing effort to modernize has resulted in new tools and features to help taxpayers since last tax season. Improvements include more access to tax account information from text and voice virtual assistants, and expanded features for those with an IRS Individual Online Account.
Based on current funding levels, the agency expects wait times on the main phone line to average less than five minutes—about the same as last year.
Another improvement: 67 IRS forms are accessible on cell phones and tablets. The most recent forms have “save and draft” capabilities, so you can start a form, save it, and return to it later.
Need Help?
You’ll find a variety of online tools at IRS.gov, including how to get ready to prepare your return, forms, instructions and publications, and tips on choosing a tax preparer.
The Interactive Tax Assistant tool provides specific answers to many common tax questions based on your individual circumstances. It can determine if you should file a return, your filing status, if someone can be claimed as a dependent, which income is taxable, what expenses can be deducted, and qualifications to claim tax credits.
Create an IRS Online Account and you can securely access personal tax account information, including balance, payments, and tax records including adjusted gross income.
Changes Ahead for Next Year
The IRS has already announced inflation adjustments for tax year 2025—the return that’s due by April 2026. Income levels for the various tax brackets have been updated to prevent bracket creep, and the standard deductions will also increase: $30,000 for married couples filing jointly, $15,000 for single taxpayer and married individuals filing separately, and $22,500 for heads of households.
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Source: Tax credits and deductions: What you need to know for 2024 tax filing
