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Federal Tax Brackets 2010

Published 10/7/09 (Modified 6/17/11)
By MoneyBlueBook

Federal Tax Brackets 2010

Death and taxes. You can try to fight them both tooth and nail, but at the end of it all, it's a losing proposition. Especially when it comes to taxes, the government is going to want its fair share cut of your salary and business profits one way or another, whether you like it or not. Rather than engage in tax evasion and possibly live the remaining years of your life on the run as a tax fugitive from the long arm of the Internal Revenue Service (IRS), you might as well confront the issue of taxes head on. All we can do is try our best to understand how income taxes work and take reasonable steps to minimize their effects on our financial lives as much as possible.

One of the most introductory ways to plan for the effects of income taxes is to recognize how the various marginal rates are applied to the corresponding tax brackets. Because the United States does not yet currently engage in a flat tax system, our taxable incomes are broken down into different taxation ranges with specific taxation percentages assessed depending on where they fall along the tax bracket spectrum. Although our 2010 tax returns won't be filed until April 15, 2011, for planning purposes, it's always good to find out the new changes to the tax code as early as possible. Let's examine some of the upcoming tax rate changes that are being projected for 2010 and compare them to the previous year's 2009 tax brackets.

Projections Of New IRS Tax Rates Have Historically Been Extremely Accurate

Year after year, even before the official IRS income tax brackets are released, a select number of tax experts have gotten together and crunched a determinative number of officially released statistics by governmental agencies - to project and extrapolate the upcoming year's tax brackets. Year after year, the tax rate predictions released by these groups have yielded results in advance with near 100% accuracy. Such an income tax bracket projection ahead of time is possible because many of the major tax code numbers are pegged to officially released inflation statistics - including the standard deduction, the personal exemption, the actual income ranges of the tax brackets, and contributions limits for the investment retirement accounts (both the Traditional and Roth IRA account).

One of these tax prognosticating groups is the Tax Foundation, a Washington D.C. think tank which collects data and publishes research studies on federal and state tax policies. The other notable group operates under the auspices of the Wall Street Journal and is comprised of a merry band of private tax professionals and economists - namely William E. Massey, a senior tax analyst from the Tax and Accounting arm of Thomson Reuters; George Jones, a senior federal tax analyst from CCH; and James C. Young, an accounting professor from Northern Illinois University. For numerous years now, both the Tax Foundation and the Wall Street Journal group have consistently released to the public very accurate, albeit unofficial, early bird peaks at the following year's projected income tax brackets based on available financial data - well in advance of the official IRS releases. If you're eager to get a head start on tax year 2010, read on.

IRS Tax Rate Schedule Updates For Tax Year 2010

This year, citing a very sluggish economy and extraordinarily low inflation rates for 2009 to which upcoming 2010 tax rates shall be pegged to, the Tax Foundation and associated experts are predicting very little year to year change for the 2010 federal tax brackets. If there's anything good that came out of this global economic recession that has been plaguing us for the entirety of 2009 - it's that the combination of low gas prices, depressed consumer spending, and high jobless numbers with so many people filing for unemployment - have enabled inflation rates to stay quite low during the span of 2009 - at a mere 0.19%. Just compare that to the incredibly high inflation rate of 4.26% during the previous year of 2008 when gas prices were skyrocketing, and it's clear the recent sudden and precipitous drop in inflation has been extremely unprecedented.

As a result of low inflation, for the most part the 2010 tax bracket ranges will likely stay relatively unchanged. As noted by the tax pundits, for the very first time since the IRS started to index the official federal income tax rates to inflation during the mid 1980's, taxpayers will get virtually no significant benefit from inflation in 2010. As such - year 2010 tax brackets, standard deductions, personal exemptions, and even retirement account contribution limits will see very little (if any) alterations from prior year numbers.

I will update the table below to reflect the official IRS tax rates for 2010 if decidedly different numbers are ultimately released by the IRS. However, with tax bracket projections by the experts having enjoyed a near perfect accuracy rate for quite a few years now, I don't have any reason to doubt that the displayed figures below will ultimately wind up as official.

Federal Income Tax Brackets For 2010 - Based On Taxable Income Ranges

Tax Rate
Married Couples Filing Jointly
Most Single Filers
10% Not over $16,750 Not over $8,375
15% $16,750 – $68,000 $8,375 – $34,000
25% $68,000 – $137,300 $34,000 – $82,400
28% $137,300 – $209,250 $82,400 – $171,850
33% $209,250 – $373,650 $171,850 – $373,650
35% Over $373,650 Over $373,650

Beyond some slight numerical shuffling of the taxable income ranges, there will not be too many significant tax changes from 2009 into 2010. Here is a breakdown of the projected changes (if any) for 2010 as they compare to the prior year:

  • Personal Exemption: No change. For the very first time, the standard exemption for 2010 will not be going up and will stay unchanged at $3,650, the same as it was in 2009.
  • Standard Deduction: No change, except for Head Of Household filers. The standard deduction for married couples filing jointly will remain unchanged at $11,400. For those filing as single, the standard deduction will remain at $5,700 as well. However, Head of Household filers will see a slight increase by $50 - from $8,350 (year 2009) to $8,400 (year 2010).
  • Overall Tax Bracket Thresholds: Will increase across the board for all tax filing statuses, albeit at a significantly lower amount compared to past tax year increases.
  • Annual Gift Tax Exclusion Amount: No change. For tax year 2010, the current gift tax exclusion limit of $13,000 will stay the same. Often overlooked by most taxpayers, the gift tax stipulates that gift givers must pay a special tax on gift amounts that exceed a certain amount per year.
  • Traditional and Roth IRA Contribution Limits: No change. Despite the fact that IRA and Roth IRA contribution limits did not rise in 2009 in response to strong inflationary pressures in 2009, there will still be no corresponding change in the maximum contribution limits to individual retirement accounts for 2010. The standard IRA contribution limit for 2010 will remain unchanged at $5,000. The catch up contribution limit for those 50 or older will remain at $6,000 as well.

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436 Responses to “Federal Tax Brackets 2010 | Income Tax Brackets 2010 | Money Blue Book” 

  1. Doug L says:

    If you want to make a difference, in what look to be a critical turning point into a downward spiral for the USA, get involved in the Tea Party Movement. Stop the rediculous government spending. I agree with reform for the health care industry but the goverment cant run medicare how can it run a giant health care system? It cant but in the process of doing so the government is tax us until we have nothing left. It will effect all of us no matter how much you make or dont make. America needs a change for the better not more corruption! Goin a tea party and get involved!
    http://www.grassrootsnation.com/Groups/GroupListing.aspx?type=Tea+Party

  2. Jonathan says:

    I just want you all to stop this equal opportuinty to move up the ladder garbage. Peoples aptitudes differ and I will never be a doctor because of it. I make good money, but only because I found my niche. Some people are never going to get out of the service industry becuase they don't have the skill set OR don't have the aptitude to gain the needed skill set.

    And when people complain about government handouts it makes me sick. Just wait until you have a medical emergency that drains your savings dry in a couple months and then bankrupts you. We had friends that were die-hard conservatives who did not want any social services, but when they had a disabled child they sure changed there tune.

    If your are human and you don't feel some compassion towards humanity that's a good indication that your a psychopath.

  3. Josh says:

    Jonathan:

    Why don't you cut out the bomb throwing and the patronizing. Yes, Conservatives are psychopaths with no compassion for humanity. It's exactly this simple-minded mentality that keeps us from making any real progress in this country. Repoublicans are mean. Democrats are so nice. Blah, blah, blah. Why dont you try and take that argument down another 10 or 20 levels and see if you can make some logical points based on reason.

    For the 100th time, if you listened to any of us "Conservatives" (especially my posts), you would see that we are upset that the government is wasting all of the money that should be going towards "families with disabled children". Why do you want to continue to spend hundreds of billions of dollars on illegal aliens, high school drop outs, felons, lazy leeches, etc when we could be using that money to help the truly needy. The people that play by the rules but still need a helping hand to get by. Why should they have to survive on a couple hundred dollars a week because hundreds of billions are being scammed from the taqxpayers?

    In my opinion, anyone who supports a system like that is a psychopath. But I bet it makes you feel good to tell people how compassionate you are at cocktail parties.

  4. Josh says:

    Jonathan:

    Your last comment was so irritating that I almost forgot to respond to your first.
    There is no such thing as "genetic aptitude". Every human being on this planet has an equal capacity and opportunity for learning and growth. Asians aren't smarter than everyone else, they just work harder. A kid born in the Ghetto today has the same gentic capability to become a doctor as the rich white kid in the sub-urbs. Granted, that kid has a lot more social obstacles to overcome. But his aptitude is no different from anyone else.

    If you resist the temptations to do bad things and work hard throughout your life, anyone can succeed. No one is doomed at birth to be in the "service industry".

    This is America for Christ's sake! At least for the moment.....

  5. Russ says:

    Some interesting postings of late, particularly liked Jonathan's objective feedback and Nick's use of data and fact, quite refreshing from the whining and hate most generate.

    Doug L - Did look into the Tea Party movement but found it to be very fragmented. Also find it a bit hypocritical and more geared to be against the current administration than for a particular cause. Where were they when the previous administration took us from a so-called surplus to a deficit, took that deficit to record levels and then doubled the deficit? Don't recall many DC rallies, if any. Seemed they were okay with that because that administration was so-called "Conservative," hence my claim of hypocrisy.

    Nixon was considered a Conservative yet it was he who approved Supplemental Security Income (SSI) for Immigrants.

    Clinton was considered a Liberal yet was able to put the budget into a so-called surplus situation.

    Seems any tiger can change their stripes. That's why I don't view this Red vs. Blue, or Conservative vs. Liberal. It all gets blended together in the end. To me they're all Purple Barneys. And until they vote along the lines of the Constitution, the article that all elected officials swears to uphold when taking office, I will vote out all incumbents. That's my term limits. Don't need no stinking Tea Party!

    I've come to the conclusion if your person is in the White House they can do no wrong and if it's not your person they can do no right, pure politics and pure hypocrisy.

  6. TimT says:

    @Jonathan

    Yeah, some people are not born equal in the skills department. Life sucks. That's not an excuse to steal from me to help people YOU think are not capable of supporting themselves.

    Yes, some people have life-changing events and become moochers. That doesn't mean they are right.

    You're last point about "you don't feel some compassion towards humanity that's a good indication that your[sic] a psychopath." Compassion? Does not complaining when someone steals my money and life mean I have compassion? Government force is NOT compassion. I have plenty of compassion and I'm willing to VOLUNTARILY lend a helping hand. Don't presume to know how much compassion I have. I do not like having a gun put to my head and told to be "compassionate," though.

  7. TimT says:

    @Russ : I love how libs turn to accusing someone of "hate" when they disagree with you.
    Nixon was no conservative. We've had very few conservative presidents in the last 100 years. And Clinton only balanced the budget because the republican congress drug him kicking and screaming into doing it. Spending bills originate in the House, remember?

    You are right about people cheerleading for whoever is in office. You'd think they're talking about their favorite sports team. To me, they are all a bunch of Statists that will do anything to increase the power of government.

  8. Russ says:

    The hate is coming from both sides, Tim; it's not too difficult to see that.

    Yes, I've heard it all before.

    Reagan's budget was out of whack because the Democrats made him spend, spend, and spend.

    The Clinton budget was a so called "surplus" because the Republicans made him.

    This country was better served during Coolidge, Hoover and George W Bush when the Republicans had the White House, the Senate and the House of Representatives.

    Pass the kool aid, please.

    I say so called "surplus" because our wonderfully elected officials decided to use SS/Payroll taxes to balance the General Fund/Budget. There's voodoo economics and fuzzy accounting at its best.

    Point I was trying to make is that the politicians "run" one way, but tend to "lead" another. Both sides do it. It's organic to the process. The premise is that we have a choice yet the candidates are usually so much alike the "choice" is a blur. Bush vs. Kerry - two middle aged men, with the same education, with membership in the same secret club who agree on how this country should be managed 80% of the time.

    And, of course, this last time we had real choice- Change or More Of The Same. The people who voted for change got more of the same and the people who voted for more of the same are still pissing and moaning because their guy isn't the messenger.

    Mad about the moochers, envious of the successful? Wall Streeters are considered successful, ambitious, etc yet they are the biggest moochers of late with the TARP and other bailout programs. No industry should be "protected" in a free and open society. Yet we're told they need it or we will be faced with a deep and long lasting recession. How's that playing out so far?

    In May, 2008 we were getting $300+ stimulus checks from our wonderful Government because the economists told us "it will help us avoid a recession." (Government giving away money must be a Liberal in the White House. No, wait, it wasn't W's doing the Dems made him. So much for a Leader and a Conservative. No, wait, W wasn't a Conservative, he only "ran" on that, just didn't lead that way. Give me a #%$&@ break.)

    How many Red/Republicans/Conservatives here returned their checks? After all, only Blue/Democrat/Liberals would accept a handout, right?

    Less than six months later we were in the worst financial crisis since the Great Depression. Would have been a fine time for someone to step up and say "enough, this system isn't working, time for real change." That would have been Leadership. It would be very painful to change our current system. And it will be very painful to continue it, as we are trying to do. There's our choice. Which pain would the population bear?

    Is the real issue what the tax rates are or that the Federal Income Tax itself is Unconstitutional? I think the latter but that gets no mention, just how much. As long as people get a perceived benefit from the system they will support it. With the occasional rant and rave when they feel they're getting a lesser benefit than someone else.

    I'll stop getting automatic updates from this site, there's nothing new here. Whine on sheeples; keep supporting your Purple Barneys.

  9. BluceRee says:

    "# Josh Says:
    January 5th, 2010 at 11:01 am

    2) Blood for Oil, etc, etc. Again, really hard to respond to this one because it is so ludicrous. But for this argument to hold true, you and your ilk would truly have to believe in your heart of hearts that Bush started two wars in the Middle East, put hundreds of thousands of troops in harms way and risked his entire presidential legacy, because he wanted a small group of his friends in some dark smoky room to be able to make millions of dollars on Oil futures contracts?"

    I don't buy into the whole conspiracy thing and I whole heartedly agree with the initial invasion of Afghanistan since *that* is where the terrorists were hiding/training/planning/based and aided by the Taliban in terms of being allowed in the country.

    However, would you care to explain the logic behind invading Iraq if not for the purpose of greasing the war machine and enriching Haliburton? And, please, don't even go the WMD route. A 3 year old could have seen that as bullshit because, as you well know, the Bush administration changed their story several times as to "why" they went into Iraq just before Rumsfeld resigned. And none of that "Saddam was suspected to have ties to Al Qaeda" either nor should you go the "Saddam gassed his people" route because we'd have been in both North Korea already as Kim Jong Il waived his WMDs around like big fluorescent dildos, taunting Bush, and we'd also have been in Somalia cleaning it up as it continues to suffer total anarchy, lawlessness and ethnic cleansing.

  10. Marci says:

    Russ, I didn't return any stimulus check because I didn't get one!!!!!!!!!!!!!!!

    Second, if I did receive a stimulus check, I would not return it because it was MY MONEY in the first place. It isn't a handout when I pay taxes and the government chooses to give my money back to me (but in my case, the government feels that I am too rich, even though I haven't had a new car in five+ years and took less than three weeks of vacation in the last four years - and one of those vacations was my honeymoon!!!!). By my standards, I am far from rich.

    To anyone that says that conservatives lack compassion, get real. The reality is that those that want to see Republicans be compassionate are those that are truly not worthy of ANY handout, but they know that they can scam the government, so they insist on "compassion" from the government. If you want compassion from the government, you are really saying, "give me money because I don't feel like getting a job or contributing in any way to society."

    We have 501C3s for a reason - to do public good. The government SHOULD be limited to necessary services (police, military, roads). Tax benefits for donating to 501C3s should be increased (one way to do this - you get a deduction for charitable donations beyond the standard deduction) and 501C3s should be the ones to provide welfare type programs. I trust my church, a 501C3 organization that has its tax records reviewed yearly by a CPA and the IRS, to run a welfare program that hands money, food, etc out to the needy in an effecient and effective manner far more than I trust the government to do the same. Why, because my church, like most 501C3s, is run by honest and decent people who WANT to do good. These people work day jobs and want to help others during their time off through donations of their time, talents, and/or money.

    You want to save this country, can't we all agree to pay less taxes, increase the benefits for donating to 501C3s, and maybe increase the tax review of 501C3 records (let's face it, although 95% of us are honest and decent, there are 5% who are dishonest and need to be found).

    I think that you will find that if you give PEOPLE in grassroots organizations more money from local donors, you will find that there are MANY less people in need because communities will begin to take care of their own. And instead of feeling angry at being forced to pay taxes to an inefficient and ineffective government that mismanages social welfare programs, people will feel proud by seeing their money fund a 501C3 that positively helps those that DO need the help in their very own community.

    I vote for getting the government out of my pocket and giving me my money back. Let me choose how to be compassionate. The government's role should be limited to slight encouragement through tax benefits and increased monitoring to ensure no 501C3 fraud.

  11. A. Bushkin says:

    The item on standard deduction being unchanged is WRONG. There is a change. The additional standard deduction for real estate taxes paid has lapsed for 2010.

  12. Marine 33% says:

    Re: Robin's Political Team

    Can I add a self nomination for "Constitutional Enforcer" whereby any lawmaker who attempts to pass a bill deemed unconstitutional spends 5 minutes with me in the broom closet?w

  13. cogipro says:

    Robin,
    I'm in.
    Cogipro

  14. TimT says:

    @Duh,

    Let me see if I get you right.

    America has prospered under free market capitalism for 200+ years (and low taxes for at least 3/4 of that time). It went from a backwater group of colonies to the world's largest economic superpower.

    France, Spain, and the UK went from world economic superpower status at various points in their histories to stagnant socialist swamps in little over half a century.

    You say you're tired of my whining and I should move, where?, to France? You're the one that wants the US to become France. Why don't YOU go there instead of trying to remake the US in France's image. Or stay here. It's still a free country, after all. But don't complain about me being vocal against Marxism. We still have freedom of speech here, after all. For now.

  15. z-man says:

    My wife and I had dinner with a Canadian couple a few nights ago. The conversation migrated toward health care. Keep in mind they are both professionals and have made a good living. I asked them if they liked the Canadian system. They said it was OK. I then asked if they had ever been refused treatment or had to wait for testing. Their reply was, "Yes, but when this happens, we go to our PRIVATE doctor/clinic and pay upfront!"
    So, if you are wealthy in Canada, you can have TWO health systems. Too bad if you don't have the extra money to do so......the option then is to cross the border and seek treatment in the U.S.
    I then asked him, "If you don't mind a further personal question, what percentage of your income to you pay in Canadian Tax?" He answered, " About fifty one (51) per cent". His response was entirely unemotional. Much like the beaker frog in the ever increasing water temperature, this family has been CONDITIONED to pay 51% of their money to the government, and still has to pay out of pocket for what the government will not/cannot treat.
    It is interesting that many people don't care what percentage others have to pay in order to receive what the government promises them, yet history has shown those promises to be empty. And when the 51 percenters run out of money, they'll come for whoever is left.
    If you allow the government to more of your money, you need counseling.

  16. Robin says:

    Climbing back on my soap box again.

    Health Care Reform. As a recently retired RN, this naturally caught my interest. How long has the American public been whining for it? And what's that old say ing - "Be careful what you wish for"?

    Has anyone actually tried to read the first two versions? I got as far as pages 19 and 20 respectively and just gave up. The convolutions in those things were practically awe inspiring. These documents were obviously penned by people who used a twisted pretzel for a straight rule.

    When I was going to college, a professor of mine whom I greatly respected once told us that if we couldn't explain our thesis fully in a one page summary, we obviously didn't know what the heck we were talking about.

    It really would be much easier to just change a few current rules of our existing system. An applicant can not be turned down for a pre-existing condition, any procedure costing the insurance company more than "X" number of dollars should be reviewed by an independent board of physicians (not company accountants) and the cost of routine diagnostic procedures should be standardized across the board.

    That last one would really save a bundle as I know from personal experience. Some years ago, I had cause to have a lower GI MRI done. (I didn't have health insurance by my own choice, preferring to set up my own personal money market account for medical needs rather than pay into a system I might never use.) The receptionist asked me what insurance coverage I had, and curious, I asked her what the difference would be. She replied that depending on what provider I had, the procedure would cost "anywhere from $1400 to $1600." Yes, I can quote that because it's still a vivid memory even after more than a decade. I told her I was paying out of pocket. She responded. "Oh, well in that case, it will cost you $800."

    Interesting bit of math, isn't it?

  17. Greg says:

    Financial Samurai Says: It is disappointing to have to pay 35% of income to the gov't. I point out that one would need to have a gross adjusted income of $4 million to pay 34% in Federal Tax. An income of $500,000 will pay just over 27% income tax. An income of $100,000, just under 12%. Europeans, Canadians, paying 50+percent don't whine because they recieve benefits that they cherish. Americans, for the most part, seem to cherish big take home so they can outspend their neighbors on junk that ends up in the trash.

  18. TimT says:

    Greg says: "Europeans, Canadians, paying 50+percent don't whine because they recieve [sic] benefits that they cherish".

    That sounds a lot like "From each according to his abilities, to each according to his needs." Where have I heard that before?

    Then there's Plank #2 of the Communist Manifesto:
    "2. A heavy progressive or graduated income tax."

    Greg says: "American's[sic] for the most part, [sic] seem to cherish big take home [pay] so they can outspend their neighbors on junk that end[sic] up in the trash."

    Yes. It's their money that they traded hours of their lives to receive. It's theirs to do with what they like: spend on junk, give away, throw away, invest, or whatever. It's called freedom. It's certainly better than some bureaucrat deciding where people's life energy should be spent.

  19. Mike says:

    Clowns to the left of me, jokers to the right, here I am - Stuck in the middle with you.
    UUUUUUUUUUUUUUUUUUGGGGGGGGGGGGGGGGGGHHHHHHHHHHHHHHHH!!!!!!!!!!!!!!

  20. TerryTwoPointTwo says:

    Why should I pay a higher percentage of my income in income tax? Oh, that's right, I forgot. I worked nights putting myself through undergraduate and graduate school and then worked 80 hour weeks to make my business a success. I keep 39 individuals employed. Yes, I can see how I'm the enemy. How silly of me not to understand that you are entitled to everything and anything you want. I believe I'll lay off 10 or 12 of my employees so I can pay higher taxes. Because, God forbid, you have to actually go to work to get that 65 inch TV when we all know the Government owes you one. Shame on me for not understanding that it's not your fault that you bought three times the house you could afford. I'm sure that's my fault too and I should be happy to pay for your house. I'll sign off now. I'm going to get in my paid for car and drive home to my paid for home.

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