If your income increases in 2027, there is a change that could prevent that rise from pushing you so quickly into a higher federal tax rate. Bloomberg Tax projects that the income tax brackets will rise by around 3.2% due to inflation adjustments.
But there is an important caveat: these numbers are not official yet. The Internal Revenue Service typically announces its inflation-adjusted amounts in the fall. For now, the projections allow us to anticipate how the 2027 federal tax brackets could look and what they would mean for your wallet.
How would the tax brackets change in 2027?
For a married couple filing jointly, Bloomberg Tax projects these taxable income thresholds:
For a single taxpayer, the projected thresholds would be up to $12,800 for the 10% rate, while the 12% bracket would extend to $52,025 and the 22% bracket to $109,125. The top of the 37% bracket would begin above $661,375.
The difference may seem small when you look at each figure separately. However, for a family whose income rises due to a raise, a bonus, or more hours worked, those thresholds matter.
Does this mean you’ll pay less taxes?
Not necessarily. Here’s a fairly common misunderstanding that often arises.
The tax brackets are marginal. That means that if a portion of your income falls into a higher rate, not all of your money is automatically subject to that rate.
For example, if you are single and your taxable income exceeds the 12% bracket threshold, only the portion that falls into the next range is taxed at 22%. The IRS explains that each rate applies in layers to the taxable income.
The inflation adjustment aims to prevent what is known as bracket creep: you receive a raise simply to offset the cost of living and end up paying a larger share of taxes only because the tax limits didn’t move.
How much could the standard deduction rise in 2027?
There is also a projected increase in the standard deduction, another figure that can be important when you prepare your tax return.
Bloomberg Tax calculates that it could reach:
To compare, the official 2026 amounts are $32,200 for married couples and $16,100 for singles, according to the IRS.
The standard deduction reduces the income on which the federal tax is calculated. Therefore, while an increase in brackets by itself does not automatically guarantee a larger refund, it can influence how much income remains subject to tax.
Why these figures could still change?
Because the IRS has not yet officially announced the 2027 tax brackets. Bloomberg Tax published its estimates on September 11 and calculated an adjustment of about 3.2%, versus the 2.7% applied for 2026.
In addition, this calculation has a peculiarity. The Bureau of Labor Statistics could not collect the CPI data for October 2025 due to a lapse in federal government funding. Bloomberg Tax notes that it had to work with an average of 11 months for its projection.
Therefore, if you are budgeting for 2027, take these figures as a reference and not as the IRS’s definitive brackets. The official figure will ultimately determine exactly how much income falls into each rate.
