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. Russ says:

    To cogipro - With all due respect that seems more of the same. Letting Government/Legialation take care of the problem.

    I would prefer to return power to the people and have them implement the term limits every November.

    Any legislation involving term limits would probably be lined with golden parachutes.

    And we might even raise the level of awareness of our fellow voters.

  2. Josh says:

    Thanks Joe. Between you , me and my closest family and friends I only need another 60,000,000 votes or so. It's a start though!

  3. Marci says:

    I am sick from reading the posts from the liberal socialists. I went to law school and work for a non-profit. I want to do good for this world, so my income is greatly sacrificed. I won't last much longer at my current job. Day in and day out, I see clients , who get my legal services for FREE, complain about how bad they have it. They rarely accept personal responisibility for their situation.

    99% of the people in this country are where they are because of their own life choices. And don't give me your psycho babble about your happy wife and kids - I have those too - but that doesn't change the fact that I am an extremely angry person who no longer wants to give back to the general public. I mostly see people who don't accept responsibility for their choices and then get angry/upset/etc (and I am supposed to "understand and empathize") when they learn that the government won't give them more money!!! I am happy with my personal life, but extraordinarily worried about more money being taken from my already small paycheck to give to people that refuse to take responsibility for themselves or take action to correct their own self-created misfortune.

    If you don't have money, it is very likely your own fault. There is only a very small percentage of people who don't have money through no fault of their own (those born with disabilities….but most of those aren't complaining, they are in state institutions that need the money MUCH MORE than YOU DO….but don't worry, I know that you are greedy and won't give it to them).

    You probably lack responsibility in your personal spending and lack drive and determination at your job. That is why you are poor!

    No person in this country deserves anything more than roads, police, military, a court system, and general laws for all to abide by. Essentially, you start with nothing, but in this country, you have the opportunity to do anything. If you want a free ride where someone tells you what to do and you put no effort into developing yourself, move to China, Cuba or any similar nation…..see you much better you are treated!

  4. MarkA says:

    Has anybody but me noticed the new payroll withholding rates have gone UP?!! For the last several years, I have been in a 25% marginal bracket. If you look at the 2010 IRS Publication 15, I will be (same salary) in a 27% bracket. Why is nobody reporting this?

  5. Russ says:

    MarkA - It seems the Pub 15 tables are a little squirrely with the %'s going 25 to 27 to 30 then back to 28 and then to 33. Might be our friends way to improve their cash flow while debating the outcome the expiring tax cuts from 10 years ago. Should be interesting.

    Bottom line is the income tax rates haven't changed so as long as you file your return you shouldn't have to pay any more than what the tax tables say. You could amend your W-4 to offset Pub 15.

  6. Russ says:

    A new year but no shortage of hypocrisy and BS.

    Capitalist Pig - Working for a paycheck doesn't make you a Capitalist. Share with us you definition of a Capitalist that prompted you to assume you are one.

    No one has a choice when it comes to paying their SS taxes, the employer is forced to withhold it.

    You don't have a problem with SS taxes as long as "I can live off you." Nice.

    And as far as a financial collapse, see 2008. If you think your so called "commies" were the cause if it, do further research and step away from the cool aid bar.

    You may be more of a commie than those you accuse.

  7. Russ says:

    cogipro - You are an example of what makes this a great country and the world a better place to live. Keep up the great work.

    For 2010, I hope your spirit inspires many, myself included, to do more and/or do better.

    Happy New Year!

  8. Bogeymstr says:

    On Dec24, 2009, The United States of American began its death spiral and a new country emerged. The United Socialist States of America. Yes, we have been fundamentally changed. The single largest legislation that will effect all people in this country was written in secret, passed without being read and debated before the American people, by a single party. Anything can be passed now! Card check, legalized strong arming by the unions, cap and trade, regulation of anything left in life that the Government doesn't already control. Soon, Americans will be told which Dr. they can go to and what health care they can have. If you are over 60 or retired, you are dead meat, if you have a birth defect and connot contribute to the tax coffers of the Democratic Central Committee, you are dead meat. Those of you in school will be told what and where you can work...Yes, as Newsweek said, We are now, All Socialists! The days of free and open debate are gone, the days of the right to vote are gone, and the right to live free to make the choices you want are gone. My life is coming to end, and I will escape the horrible times that are ahead. My children and grandchildren will have to deal with it. I only pray that they are strong enough in thier character to endure and survive......

  9. neighbor says:

    We can not tax the corporations more, they will just head to mexico labor. We need to tax the rich, we need to tax their salaries so much, THAT IT CURBS THEIR GREED, if they knew they would lose 65% to taxes, they wouldn't be so greedy. Anyone making over $500.000 a year needs to be taxes at 65% over that amount. We need a law that eliminates any type of government retirement benifits, no medicare, or SS for any CEO who ships jobs out of this country, to make a buck on cheaper labor. Maybe we should even take away their citizenship, and make them live in those other countries. Why is California so broke with all their millionaires, because the millionaires want this, and that, they want their childrens schools to have the best, they want their town to look gorgeous, they want nice roads, they want private roads the general public can't use as a shortcut, to get around traffic, fancy street lights, and all those extra's cost money. If they don't pay their share of taxes, the government goes broke trying to meet their desires. We have to heavily tax the wealthy to curb their greed.

  10. Josh says:

    I'm rather amazed at the number of comments here promoting a return to accountabiliy, responsibilty and self-reliance. Usually topics of this sort get immediately drowned out by hundreds of Leftists demanding this and that. Encouraging to see this type of dialogue.

    I guess I shouldnt be too surprised though. If you are posting on this blog page it was because you were concerned about how much you would be paying in taxes in 2010. Since the vast majority of Leftists dont pay taxes, I dont think they really care what the 2010 rates are.

    Even so, I will attempt to delude myself into thinking that mayebe the electorate in this country is changing and we may start to hold our government officials accountable. Sure would be nice to see a collective "Enough is Enough!" next November.....

  11. Russ says:

    Yikes, what a diverse level of commentary.

    While I agree that this country is heading in a bad direction, I don't agree that it is a recent turn. What is going has been going on for almost 100 years. With both sides adding gasoline to the fire. Yet some see it as Red versus Blue. I see them as all Purple Barneys, playing the general public (voters) as patsies and bribing them with their own tax dollars to get their vote.

    It leads to passionate commentary, like some of the posts here. We should try to stay clear of the name calling and hysteria. There are enough legitimate factual problems without having to contrive ones.

    Neighbor - Check the US Constitution before you give the Corporations a free pass.

  12. Bogeymstr says:

    If you haven't read or heard about today, the new health care reform mandates will administered by the IRS.......can no one see what is really going on here!!!!!! It is not about taxes!!!!! It is about a ruling class and a working class, you have be one or the other, or you have no place in the "New World order". I suggust you take another read of 1984 and Farenheit 451, as well as many of the contemporary books on the subject of this administration........

  13. neighbor says:

    War, stimulates economies. If the war ended tomorrow, where would all those servicemen, and women work? What jobs would be available? Was the real purpose of the war to stimulate the economy, and make things look better than what they really were? Is what they told us the real story? Could it be is was really a oil war? Was this all a set up leading up to higher oil prices? Who would benefit from higher oil prices? Was the 401k national retirement plan to replace Social Security, the next step to milking us out of our money. The natural reaction when your funds start losing money is to pull out, but then someone else steps in, buys low, and reaps the profit, of those who pulled out when the market started to tank. I'll tell you if you were an oil guy, and made all that money on the oil increase of 2007, then took that profit, and rolled it into the stock market when it bottomed out in march 2009, you would be a very rich person today. Thats exactly why you should pay 65% taxes on all that money you made!

  14. Joey says:

    Hey Neighbor

    Do what I did, get yourself an address in low tax Nevada and keep your Ca. home too.. Let someone else pay for the schools, roads and fancy lights.

  15. get real says:

    Isn't it obvious to the American Proletarians that the really rich people in this country don't pay taxes? Maybe to someone making $30k, $300,000 seems like a lot of money. Doesn't it just burn you up that someone is driving in a new BMW while you slave away in your old Honda? Poor babies!

    Get a grip people! The very rich spend millions to make sure tax laws are passed to protect their billions. Like George Carlin said, "it's one big club, and you ain't in it!"

    We're all a bunch of suckers. This whole joke of an economy will be coming down soon. Good riddance, say I.

  16. Josh says:

    Neighbor:

    I hesitate to try and logically respond to your rant. Because, with all due respect, you don't really seem to be one who is grounded in logic. You seem more like a Daily Kos/Keith Oberman disciple. But I'll give it a shot anyway...

    1) You seem really upset that Bush tried to give us Private Account options instead of the straight Social Security government pyramid scam. Here's a tidbit you probably haven't heard. Someone retiring today after working ~45 years gets...what... $23,000 a year in SS? Do you know that if that person had put all of his SS taxes into the S&P Index he would get over $125,000 PER YEAR today. And thats after the crashes of 2001 and 2008. Yes, choice and ownership (and Capitalism too I guess) are horrible things. I would much rather "own" my retirement funds then "hope" that the government will be solvent enough to pay me the $23k a year when I retire. And make no mistake about, this government is heading to bankruptcy. Oh wait, I forgot, the money is sitting in a "lockbox" :)

    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 (and probably faked the 9/11 attacks), 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? If you do beleive that, I obviously cant change your mind.

    3) "Why did all those greedy loan processors tell people they could afford those ridiculously huge mortgages, based on their low pay"

    God, I wish I had time to write 5 pages on this one. A very complicated subject but I can sum up the entire cause of the Mortgage/Housing bubble/collapse in 2 words. Fanny and Freddy (those are government agencies if you didnt know). We've had Sub Prime mortgages and those stupid EOC laws "encouraging" lenders to make loans to minorities/poor people for decades (started with Carter). But banks aren't stupid. They found ways to avoid making those EOC loans. EOC went short of holding a gun to banks heads and forcing them to write bad loans. But in 1995 something changed. The Clinton Administartion changed the Freddy and Fanny ruls to allow "the government" to purchase Sub Prime mortgages on the secondary Market. All of a sudden, if a bank wrote a horrible loan to someone who couldnt afford it, they didnt need to worry about whether they ever paid it back. They could just write the loan, lock in the UW fee, and then turn around the next day and sell that horrible loan to YOU AND ME, the TAXPAYER! It was a license to print money. No risk, all reward! The goverment thought it would be a good thing if the poor and minorities "owned" (lol) homes they couldnt afford. So they bought every one of those damn mortgages. Long story short the pyramid scheme worked fine for about 12 years as home prices rose the banks could just sell foreclosed properties for a profit. When home prices went down....POP!

    I know you had some more points, but it's too tiring to respond to them all. Maybe later.

  17. Russ says:

    Seems everyone has to have a bogeyman to be afraid of or blame, reminds me of Hitler.

    Neighbor - It's not that anyone needs to make more than $500,000 a year. It's the fact that in a free and open society you should be allowed to, within the rules and regulations, of course.

    Josh - Your numbers don't jibe. Don't take the 11%+ "average rate of return" for the S&P 500 over the past 65 years as a straight line return. The S&P lost 37% in '08. To break even one would have to earn 58%+ in '09. That's a net of over 21%, or an "average" return of over 10% for '08 & '09. Yet all you did was breakeven. There's no way you would have over $125,000 per year to live on. Average salary back then was about $2,000 and the SS withholding was not the 6.2% that it is today. And the "return" includes capital gains, while income you can live on has to come from dividends alone if you want your principal to stay the same. Bush's plan to turn SS to equity accounts was a big pile of money to Wall Street. See http://www.pbs.org/wgbh/pages/frontline/retirement/interviews/bogle.html

    As for the mortgage mess. Blame whomever you want but Fannie was under investigation from 2003 - 2006. During that time, Fannie and Freddie went from having 70% of the securitization market to 30%. Someone had to pick up the slack. The Bear Sterns, Lehman's and Goldman's of the world, the so called "Secondary Market," all had their own Sub-Prime shops. Who do you think picked up the slack while Fannie was under investigation?

    You want to make this a Dem/Blue vs. Rep/Red thing, be careful. The Reds controlled Congress in '03. As I said before, they're all Purple Barneys to me.

    As for wars...bet you think WWII was about Pearl Harbor. ;-)

  18. Stephen says:

    OK well I may be only 23 and may not know anything. But I am a Soldier and have been for 5years now. I hate complaining. I hate peple that whine about everything. We aren't paid very well and I am not going to b!tch about the rich getting Taxed so much. Personally, I think we should all be treated equally. You have people on here talking about they should be paying more taxing because they make more. No thats not true. They are successfull and you are not. You are a lazy bum who choses to live on unemployment.

  19. steve says:

    Federal tax is just a small part of your overall taxes... Consider State taxes, sales taxes, FICA (7.5% you + 7.5% your employer), medicare, car taxes and yearly license fees, property taxes, all sorts of fees, fees and taxes on your phone bill. It is endless.
    If you were to look up statistics I would guess that for every dollar you make about 60% is taken from you when you look at the big picture.

    The federal gov't is heading for its third bankruptcy and perhaps its last. The banks and big business are already running the country anyway with gov't officials as their front men. Don't fool yourself there is no difference between the two main parties. An illusion of having a choice when there in none.

  20. Work-Harder-Stop Complaining says:

    Stop bitching about wealthy people paying less taxes and get off your lazy ass and work instead of complaining about how many yachts they buy. I'm 25 with a 140k salary and buy no means am I wealthy. I still have a beat up old car and trying to save for a home in which i cant qualify for because of the stupid individuals in the mortgage industry giving loans out to people for 2 million dollar homes with incomes of 20k. Its you lazy slobs that bring down this economy and want a hand out from the people that drive this economy.

    If you want better health-care get a better job and pay for it if you want nicer clothes get a better job and pay for it. Are you catching the overall theme here that says if you want better things you need to work for it instead of expecting it from your ridiculous so called government. Ever notice your government figure heads are buying 5 million dollar homes in every state and there salary's are only 200k. Also why does the president need a 400k salary 50k annual expense account 100k non taxable travel expense and 19k for entertainment.... strange isn't it???? WORK YOU LAZY PEOPLE!!! THIS COUNTRY WAS BUILD BY HARD WORKERS NOT LAZY SLOBS THAT WANT HANDOUTS FROM EVERYONE!!!!!

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