Tax Brackets: Do you know where you stand?

Tax Bracket -  A tax bracket refers to a range of incomes subject to a certain income tax rate. Tax brackets result in a progressive tax system, in which taxation progressively increases as an individual's income grows.

You may have heard of these things called “tax brackets” ↑ but do you really know what they are, or which one you’re in?

The United States has what we call a progressive tax system, meaning that those with higher incomes, pay higher tax rates. And the tax code will split taxpayers across seven federal tax brackets. The important thing to know here though is that no matter which bracket you’re in, you won’t pay that rate on your entire income. Aka — even if you’re in the 15% tax bracket - you don’t pay 15% on everything you make.

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Each year the brackets can change, so the bracket you thought you were in back in 2017 (so old school) no longer applies. Here are the 2018 tax brackets to determine what you owe based on what you make.

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