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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. micah smith says:

    ANY LOWER INCOME PERSON NEEDS 15 minutes to file at fasfa.gov to get a FREE EDUCATION and subsidized student loans to live off of while they attend school. Daycare is also subsidized...

    If you do not have a college education you are stupid, lazy, or both. Futhermore, there are many ways to make tons of cash without an education.

    IF YOU DON'T HAVE ENOUGH MONEY YOU NEED TO EARN MORE NOT steal from others, and aligning with those that do.

  2. The Disabled says:

    There are comments about disabled living off FEDERAL dollars. The disability act is an insurance. It is not a federally funded entity. You are right alot of men and women are collecting unjustly. Just as they do for work related injury. However oversite for disability is the feds responsibility. The one commenting on the workability of the disabled has never met my disabled neice. She has never ever been able to speak to her mother. She was born with autisum and is 100 Percent disabled. These children too are on disablility. NO they never have worked and yes she could do something. Although the only thing she does if allowed not institutionalized is eat garbage out of a garbage can. She has had to have surgury over a bowel obstruction for eating garbage out of my sisters garbage can. We love our niece and she is important to us. She can not do any job of any kind and needs instatutional care because she is disabled. That is what disablility is. I too am disabled after paying the max. in for Social Security. I would have loved to be able to continue to work, Drive, Walk, Talk on the phone, or even fill this form out without becoming ill. I cant. Diabetes Melitous can Kill eventually. Its a very slow cruel death. You loose a little bit every day. Wouldn't wish it on anyone form their childhood.

  3. ryan says:

    Josh, Ken C, John T, Tim T:

    Great posts! Finally people that speak my language! Can't wait till Nov.

  4. Peter says:

    I would personally approve of lowering taxes no matter how much worse the service we get in exchange of those taxes becomes. That service is not all that great anyways--why not eliminate most of it.

  5. some 14-year-old says:

    I also agree with JD (and jonathag, he's got his integrity straight). I'm fourteen and stumbled across this while looking up tax rates for a debate speech, so I don't have that much of an insightful opinion to offer... But you are the person who determines your future. Of course, all complaints about people in higher tax brackets are unfounded, and I think that the tax rate for "rich" people should be lowered; those who barely make the 35% bracket can pay ten times as much as the incomes of those in the 15% bracket, so why don't all of you tax-the-rich people shut up! This is America, where everyone has an equal opportunity to hit the big time. I also believe that if the government spent less on, say, health care, and more on public enrichment, then the whole tax debate would cool down a bit.

    Finally, thank you to the person who wrote this article; it was informative and helpful.

  6. some 14-year-old says:

    Also, although I know she is way higher up the comment list, Miss Swan is a fool.

  7. Ken says:

    Clueless people like Gwen need to look at actual numbers rather than just listening to goofball left wing talking points. Then you would realize that people in the 35% bracket have been paying MORE than thier fair share for years. Accoring to the Democrats, people who make a lot of money are evil, selfish people who do not desrve it, and everybody in the other brackets are all hardworking people who just cannot seem to catch a break, and should be (in Gwen's word) subsidized.

  8. Brian says:

    Lets tax everyone 100% and divide it up from there. Too bad there won't be anything to buy because there will be no incentive to make anything.

    The happiest people are the ones who have accomplished something and made their own way. If that means you make over 250k, don't feel guilty, and don't let the government push you around with doomsday scenarios. The end of the economy will not come as a result of the free market, but as a result of an ever growing, overpaid government that would rather bankrupt the country than cut worthless, failing socialist programs.

    If you don't like the free market, move. That means you too Obama, Pelosi and Reid.

    No president is supposed to be "Commander and Chief of the Economy," that is up to the american people. Keep taxes low, government small, and let the american people take it from there.

  9. Jon says:

    Income tax doesn't tax wealth, it taxes income. Most people who are in the 35% bracket make a lot of income becauase they work thier butts off. Borrowed a lot to go to college, maybe worked part time (or full time like I did) and skipped all the partying to get good grades, to get a good job. Then when they were out of school, they kept on working thier tails off to get an early promotion, etc.

    a 35% tax on these people just sends the message to our kids "dont work hard, because if you do the Government is going to take the fruits of your labor and share them others who didnt work so hard at building skills and knowledge that they could sell to EARN a high salary. No wonder so many kids think education is a joke!! Yeah, you go work hard so we can "spread the wealth around", haha, jokes on you. Why make the extra effort if we are just going to equalize the outcome?

    You dont become a doctor, a lawyer, an engineer or a successful business owner through luck - it only happens through lots and lots of sustained hard work over a long period of time. Removing the incentive for people to get ahead, and better themselves means people will stop trying.

    IF YOU WANT TO TAX THE RICH, TAX ASSETS NOT INCOME. INCOME TAX JUST HITS PEOPLE WHO WORK HARD AND SACRAFICE.

  10. Free says:

    JOSH conveniently left out the role of the bankers in repackaging those crappy mortgages into Mortgage Backed Securities and swapping them like they were high value assets when no one truly knew their worth including the bankers and investors. Also he left out the rating agencies who rubber stamp ran out of ink while rating anything across their desks as investment grade or high quality investments!! It's easy to point the finger but make sure you use more than one finger as there were mutiple levels of wrong doing in this get rich scheme. Private industry, the borrowers, and the govt were all at fault

    It's funny reading some of these posts saying they can't wait till November. Do they realize the two party dominated system will never benefit the electorate instead it benefits the high end donors. More so now than ever thanks to the Supreme Courts ruling.

  11. Free says:

    For all who believe taxes have increased from 2008 levels...Not my words but cut and paste. http://www.taxrates.cc/html/us-tax-rates.html

    Standard Deduction: The great majority of American taxpayers take the standard deduction rather than itemizing deductions for expenditures such as mortgage interest, charitable contributions, and state & local taxes. The standard deduction increased to $11,400 from $10,900 (up $500) for married couples filing a joint tax return, increased to $5,700 from $5,450 (up $250) for singles and married individuals filing separately, and increased to $8,350 from $8,000 (up $350) for heads of household.
    - Overall Tax Bracket Thresholds: Increased across the board for all tax filing statuses. This means that if your annual income did not increase since last year or if you did not receive an inflation based pay raise, you may likely pay a little less in taxes in 2009 than in 2008. As the IRS notes as an example on one of its press releases, in regards to a married couple filing a joint return, the taxable income threshold separating the 15 percent bracket from the 25 percent bracket is $67,900, up from $65,100 compared to tax year 2008.

  12. Josh says:

    Wow, been a way a long time. Surprised this blog is still going.

    Anyway, Unnecessary:

    I wasn't saying anything about how hard it is to study Literature or be a journalist. I was just saying, if you did study Lit, Communications, Socilogy, Philosophy, Art, Music, etc, etc then don't complain about not making money and how tough you have it. And certainly don't look for the government to take from others and subsidize your life to make things more "fair". You take those majors because either 1) it truly is your passion and you don't care about making money OR 2) you want college to be a little easier than studying Organic Chem all weekend.

    You seem to be doing all right and not asking for anything. Good for you.

    Josh

  13. total says:

    I was raised in a family of limited means, but learned a most valuable lesson there. If you want something bad enough you'll work for it. I worked 2 jobs to put myself through college. No scholarships, no welfare, not even family to help (they moved out of state). No complaints here. I am a better person for it.

    I especially like Josh's comments.:). If you choose to persue a degree in Philosophy, you understand the limits of your marketability.

    Personally I think a flat tax is best with perhaps the first 10000 tax free (basic needs).
    I think the government has got us fighting against each other when it is in fact to blame. Taxes as a whole are entirely too high. The government should be involved in a limited manner such as providing for the common defense (armed forces). As it stands, the government is a behemoth, and highly inefficient. For every dollar that filters down to a person in need, it spends 3 or more in bureaucracy.

    It used to be, when someone was in need that the people in the community would come together to help out. Local people could discern those truly in need, thus eliminating the deadbeats. But it's too easy to accept money from an impersonal government that doesn't know when to turn the spigot off.

    My wife has got cancer and we lost our GM benefits and we're back in the 15% bracket. But by God's grace we are surviving without government intervention.

    If the government had invested the social security taxes that they took in, it would be in much better shape. But they used the money for other purposes. Even though I don't think social security is a government mandate, since I paid into it for 30+ years, I am hoping to get some of it back when i qualify.

  14. Jim Clark says:

    I'll paraphrase Judge Andrew Napolitano, the only media personality with the cajones to say it. There are 3 ways to acquire property:
    1. Inheritance or homesteading: The property was previously owned by no one, or was transferred
    2. Trade of services or other property in the marketplace.
    3. Theft. Forcibly taking that which does not belong to you.

    Which one does the government employ?

    Until we recognize that taxation is theft we will always suffer under degrees of tyranny. There are three reforms we need to make in order to restrain government:

    1. Funding for government must be voluntary, like any other charitable institution.
    2. Only net funders of the government agency may participate in its elections.
    3. No election of office may be won with less than 50% of the electoral vote.

    These reforms would prevent the government from expanding unchecked, while providing an incentive to fund that which the people find are the legitimate functions they wish government to perform. They also address the current flaw in our electoral process that encourages people to vote "strategically" instead of principle. Strategic voting is characterized best by voting for the lesser of two evils. The third reform would force run-off elections until a candidate received over 50% of the vote.

    These reforms would necessarily be implemented at all levels of government. They conform to the principle of non-aggression, are fully democratic, and public policy would soon fall in line to the will of the people. They neither support nor encourage a ruling class.

    Of course, there is little chance that the public will reach this understanding, and even lesser chance that the criminals in power will lay down peacefully if the public demanded it.

    I offer it for prayerful meditation and debate.

  15. gregory miller says:

    I get so sick of that insipid clich, "money can't buy happiness." Poverty can't buy anything. Pay your fair share, wealthy, and stop bitching. This may come as a huge shock to you, but to most of us who have served our country and played by the rules but only earn a 5 digit income, an income in the high 6 digits is wealthy.

  16. shinamoo says:

    People are lazy that is why they are poor. This is America, the land of opportunity. Get it! So, if you are poor, it's because you are too lazy and refuse to do everytihing to improve your life. You have no one to blame but your lazy asses. You want to talk about fairness. Good me too. Flatrate is good for everyone. 15% rich or poor. That's fair.

  17. TimT says:

    @Gregory Miller: Money can't buy happiness, but it can sure ward off a lot of misery. Now for your wealth envy misconceptions: "Pay your fair share, wealthy, and stop bitching." How much do you suppose the "fair share" is that the wealthy should pay? How much of all income taxes should, say, the top 10% of income earners (that's an income of $113,799 and up, BTW) pay? Would 40% of all taxes be their fair share? TRY 70%! Yes, your rich 10% pays 70% of all federal income taxes (2008 data). Please tell me you don't think their "fair share" should be MORE than 70%.

    BTW, the bottom 50%, with incomes <$33,048 pay 2.7% of income taxes. But how many goodies do they get?

    Another misconception (not one you mentioned, but widely held): After the Bush tax cuts for "the wealthy" the percentage of taxes paid by the rich went UP.

    These are the IRS's own numbers.

  18. meh says:

    ABolish the existing tax code?!?! Then how will the goverment be able to hide it's theft of the people's money? THe fair tax is too fair lol

  19. Caleb says:

    I'm living in a crowded house with my single mom and siblings, and can't afford shit. I mostly live off mcdonalds and canned "value" kroger brand food. My dad doesn't pay child support and the government sure as hell wont pay for him. All five of us live off 40,000 a year and yes my mom actually works full-time like a good person. But even I'm smart enough to be a CONSERVATIVE! I have a 4.0 and study my ass off every day so that I can be a surgeon one day. And I'm not going to practice it in the U.S. unless taxes go down, because I'll never pay for taxes that are unjust, I don't want to have more taken for the more I earn! Social security, yeah it's fair but it should end in about 20 years (even though i bet it wont) And paying for roads and schools, that's fair for the most part too. But welfare? It's here to stay and 40% of Americans live off it. WHAT THE HELL AMERICA?! I know a kid in my town who's a perfect example, his family lives off welfare to avoid work. I for one say, enough is enough. Less than half of the people on welfare actually deserve it. WE NEED STRICTER WELFARE LAWS AND LESS PROGRESSIVE TAX INCOME RATES. fair is fair, I'll make something out of nothing in my life, like everyone else in my position should. I'll take loans and eventually pay them off, but I for one will not pay for lazy people who choose to live shitty lives for free. I can relate to all these socialist retards, but don't agree with them. I don't get welfare now, why should I have to pay for it after I make something of myself? The only kind of rich people who deserve to be taxed more heavily are people who cheated their way into getting so much money. But unfortunately, those are the kind of people who are taxed the least. A lazy guy in a trailer should pay the same taxes as a hardworking single mom. Instead of welfare, we should have shelters with soup lines. Basic needs should be free, but wants shouldn't. Fuck you politics for making my mom pay taxes for people living just as badly as us; she works but could get the same not working. What the fuck?

  20. Chance says:

    all i can say is educate yourself. ill be your example. three years ago i was living paycheck to paycheck. today with no change in pay i have a $30000 401k plan a $7000 roth ira $15000 emergency fund and a new house all because i learned to reduce my taxes and manage my money. all knowledge i have recieved was free on the internet at places like yahoo finance etc.. and yes im truley working class my tools of trade are a sledge hammer and shovel. if your argument is that you dont have the time i call bulls@$t as i work 12.5 hours everyday and have a 2 year old daughter. So again what im saying is educate yourself learn to manage your finaces and quit the boohoo somebody do it for me act.

    IF NOT ME THEN WHO? IF NOT NOW THEN WHEN?

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