The Internal Revenue Service has published the official 2027 tax brackets, and for taxpayers and investors alike the update is a quiet win: all seven federal income tax rates stay exactly where they are, but nearly every income threshold moves higher. Announced Nov. 5, 2026, in Revenue Procedure 2026-35, the inflation-adjusted figures raise the standard deduction, widen the lower brackets and push the point at which the top 37% rate begins further up the income scale. The result is a combination that can keep more of your salary, bonus and investment gains out of the IRS's reach.
For 2027, the seven marginal rates remain 10%, 12%, 22%, 24%, 32%, 35% and 37%. Those rates were made permanent by the One Big Beautiful Bill Act, signed in July 2025, which locked in the lower bracket structure created by the 2017 Tax Cuts and Jobs Act rather than letting it expire. What changes each year is where each rate begins and ends, and for 2027 the thresholds rose again to reflect inflation.
The 2027 Tax Brackets, at a Glance
For single filers, the 10% bracket now covers taxable income up to $12,800, the 12% bracket runs to $52,025, the 22% bracket tops out at $109,125 and the 24% bracket reaches $208,325. The 32% and 35% brackets fill the middle of the schedule, and the top 37% rate now applies only to taxable income above $661,375, up from $626,350 just two years earlier.
- 10%: up to $12,800
- 12%: $12,800 to $52,025
- 22%: $52,025 to $109,125
- 24%: $109,125 to $208,325
- 32%: $208,325 to roughly $264,550
- 35%: roughly $264,550 to $661,375
- 37%: over $661,375
Married couples filing jointly see a similar widening. The 10% bracket reaches $25,600, the 12% bracket runs to $104,050, and the 37% rate kicks in only above $793,650. Head-of-household filers receive their own scaled thresholds, all of which rose in line with inflation.
- 10%: up to $25,600
- 12%: $25,600 to $104,050
- 22%: $104,050 to roughly $218,250
- 24%: roughly $218,250 to $416,650
- 32%: roughly $416,650 to $529,100
- 35%: roughly $529,100 to $793,650
- 37%: over $793,650
Just as important, the standard deduction is climbing. For 2027, it rises to $16,600 for single taxpayers and married individuals filing separately, $33,200 for married couples filing jointly (up from $32,200 in 2026) and $24,925 for heads of household. Because the standard deduction cuts taxable income dollar for dollar before any rate applies, that increase is effectively tax-free income for the roughly nine in ten filers who take it.
Why the Brackets Kept Their Shape: The OBBBA Effect
Not long ago, the phrase 2027 tax brackets looked like a warning sign. The individual provisions of the 2017 Tax Cuts and Jobs Act were scheduled to sunset at the end of 2025, which would have snapped the schedule back to the higher pre-2018 brackets and lifted the top marginal rate to 39.6%. That reversion never came.
The One Big Beautiful Bill Act made the seven-rate structure permanent and extended the enlarged standard deduction. Its Working Families provisions also locked in a bigger child tax credit and an expanded earned income credit. The result is that the 2027 announcement is an ordinary inflation adjustment rather than a structural tax increase, which is exactly why the IRS frames it as taxpayers continuing to benefit from the working-family tax cuts.
What the New Brackets Mean for Investors
For anyone managing a portfolio, the 2027 figures matter well beyond the paycheck. Long-term capital gains rates stay at 0%, 15% and 20%, but the 0% band is now wider: single filers can realize long-term gains at a 0% rate on taxable income up to $51,050, and married couples filing jointly up to $102,100. The 15% rate applies above that, the 20% rate is reserved for the highest incomes, and a 3.8% net investment income tax still layers on for single filers above $200,000 in modified adjusted gross income (or $250,000 for joint filers).
Those higher thresholds create more room for tax-efficient moves. Investors who stay within the 12% bracket or below can harvest long-term gains at 0%, while the wider brackets give retirees more headroom to convert traditional IRA balances to a Roth without spilling into a higher rate. In the days after the release, financial planners emphasized that the new brackets make it easier to model exactly how much to convert in 2027 and remain under a chosen rate.
The estate and gift tax picture also improves. The basic estate tax exclusion, the amount you can transfer before federal estate tax applies, rises again for 2027 to roughly $15.49 million per person, and the annual gift exclusion climbs to $20,000. Because the One Big Beautiful Bill Act made the higher exclusion permanent and inflation-indexed, high-net-worth investors can keep planning around a limit that moves up each year rather than a scheduled cut.
Credits and Deductions That Grew for Families
The 2027 adjustments also lift several family-focused benefits. The child tax credit rises to $2,300 per qualifying child, up from $2,200 in 2026, with as much as $1,800 of it refundable. The maximum earned income tax credit reaches $8,496 for filers with three or more qualifying children. Those are not rounding errors for households on the margin; they directly lower the bill for working families and continue the direction set by the Working Families tax cuts.
Where Things Stand and What to Do Next
The 2027 brackets apply to income earned during calendar year 2027, which taxpayers will report on returns filed in early 2028. For planning purposes, the message is simple: because the two lowest brackets rose faster than inflation, more income will be taxed at 10% and 12%, and the higher standard deduction shields even more earnings entirely. That is the classic defense against bracket creep, the hidden tax hike that occurs when wages rise with inflation but tax thresholds do not keep pace.
For most people, the practical steps are the same as any year: figure out which bracket your expected 2027 income lands in, adjust withholding if your situation changed, and time discretionary income such as bonuses, stock sales and retirement distributions around the new thresholds. For investors, the wider 0% capital-gains band and the larger brackets make 2027 a good year to review loss harvesting, gain harvesting and Roth conversion strategies with an adviser.
The Bottom Line
- The IRS released 2027 tax brackets on Nov. 5, 2026, keeping the seven rates from 10% to 37%.
- The standard deduction rises to $16,600 for singles and $33,200 for married couples filing jointly.
- The top 37% rate now starts at $661,375 for singles and $793,650 for joint filers.
- Long-term capital gains at 0% now reach $51,050 for singles and $102,100 for joint filers.
- The child tax credit rises to $2,300 per child, and the estate tax exclusion climbs to about $15.49 million.
