2025 Tax Brackets, Standard Deduction, and Other Changes

The IRS recently published the annual inflation updates for 2025. If you have questions about a particular amount that I do not mention here, you can likely find it in the official IRS announcements:

• Rev. Proc. 2024-40 contains most inflation adjustment figures,
• Notice 2024-80 contains figures relating to retirement accounts, and
• Rev. Proc 2024-25 contains figures relating to health savings accounts (HSAs).

Single 2025 Tax Brackets

Married Filing Jointly 2025 Tax Brackets

Head of Household 2025 Tax Brackets

Married Filing Separately 2025 Tax Brackets

Standard Deduction Amounts

The 2025 standard deduction amounts are as follows:

• Single or married filing separately: $15,750
• Married filing jointly: $31,500
• Head of household: $23,625

The additional standard deduction for people who have reached age 65 (or who are blind) is $1,600 for each married taxpayer or $2,000 for unmarried taxpayers.

IRA Contribution Limits

The contribution limit for Roth IRA and traditional IRA accounts remains at $7,000.

The catch-up contribution limit for people age 50 remains at $1,000.

401(k), 403(b), 457(b) Contribution Limits

The salary deferral limit for 401(k) and other similar plans is increased to $23,500.

The catch-up contribution limit for 401(k) and other similar plans for people age 50 and over remains at $7,500. For people who turn 60, 61, 62, or 63 in 2025, the catch-up contribution limit is $11,250.

The maximum possible contribution for defined contribution plans (e.g., for a self-employed person with a sufficiently high income contributing to a solo 401(k)) is increased to $70,000.

Health Savings Account Contribution Limits

For 2025, the maximum HSA contribution for somebody with self-only coverage under a high deductible health plan is $4,300. The limit for somebody with family coverage under such a plan is $8,550.

The HSA catch-up contribution limit for people age 55 and over is not inflation adjusted, so it remains at $1,000.

Qualified Charitable Distributions

For 2025, the limit for qualified charitable distributions (QCDs) for people age 70.5 and up is increased to $108,000 (per spouse, if married).

Capital Gains and Qualified Dividends

For 2025, long-term capital gains and qualified dividends face the following tax rates:

• 0% tax rate if they fall below $96,700 of taxable income if married filing jointly, $64,750 if head of household, or $48,350 if filing as single or married filing separately.
• 15% tax rate if they fall above the 0% threshold but below $600,050 if married filing jointly, $566,700 if head of household, $533,400 if single, or $300,000 if married filing separately.
• 20% tax rate if they fall above the 15% threshold.

Alternative Minimum Tax (AMT)

The AMT exemption amount is increased to:

• $88,100 for single people and people filing as head of household,
• $137,000 for married people filing jointly, and
• $68,500 for married people filing separately.

Annual Gift Tax Exclusion

For 2025 the annual exclusion for gifts will be $19,000.

Estate Tax

The estate tax exclusion is increased to $13,990,000 per decedent.

Pass-Through Business Income

With respect to the 20% deduction for qualified pass-through income, for 2025, the threshold amount at which the “specified service trade or business” phaseout and the wage (or wage+property) limitations begin to kick in will be $394,600 for married taxpayers filing jointly and $197,300 for single taxpayers, people filing as head of household, and for married people filing separately.