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2008 Federal Income Tax Brackets: Official IRS Figures

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Here are the Projected 2009 Federal Income Tax Brackets, projected in the same way and by the same people as did the last projection.

Last September a bunch of places started giving previews of the 2008 IRS tax brackets prior to the IRS revealing them, such as Kiplinger’s and the WSJ, and I wanted to compare them to the actual 2008 tables. All in all, it appears that the calculations made by the experts were spot on when compared to the figures revealed by the IRS. It makes sense though because the calculations were based on government released inflation figures. Here are the official IRS tax bracket numbers:

2008 IRS Tax Brackets

Tax Rate Single Married Filing Jointly
10% Not over $8,025 Not over $16,050
15% $8,025 – $32,550 $16,050 – $65,100
25% $32,550 – $78,850 $65,100 – $131,450
28% $78,850 – $164,550 $131,450 – $200,300
33% $164,550 – $357,700 $200,300 – $357,700
35% Over $357,700 Over $357,700

2008 IRS Deduction, Exemption & Limit Changes

Finally, all the 2008 deduction and exemption values were published by the IRS in October, here are the notable increases (or unchanged values):

  • Personal and dependency exemptions increase $100 to $3500 each.
  • Standard deduction for married couples filing jointly increases $200 to $10,900. Singles and married filing separately increases $100 to $5,450. Heads of households get a $150 increase to $8,000.
  • Maximum earned income tax credit (for low/moderate income workers and families with 2+ children) increases from $4716 to $4824. The income limit for this increased to $41,646.
  • The maximum Hope credit increases $150 to $1,800.
  • Roth IRA contribution limit phase outs begin at $101,000 (+$2k) for singles and HoH, $159,000 (+3k) for married.
  • 401(k) and 403(b) contribution limits remain unchanged at $15,500.
  • Annual limit for most defined contribution plans increases to $46,000 from $45,000.
{ 172 comments, please add your thoughts now! }

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172 Responses to “2008 Federal Income Tax Brackets: Official IRS Figures”

  1. Anonymous says:

    So sad to see so many ignorant American citizens beleiving that they are required to pay over the federal income tax. The Internal Revenue Code is so plain. Of course no one for the most part has access to the Code and if they did they would not know what to look for or where. Subtitle “A” is the only subtitle consisting of 1,563 code sections on income taxes. At section 1,461, you can read who is “LIABLE” for the tax. It is a government agent collecting the tax from either a nonresident alien or foreign corporation. Nowhere else in the entire Code can there be found one section requiring anyone other than a federal employer or federal employee, required to pay the federal income tax. Just look at the three words. FEDERAL INCOME TAX. The tax is on federal income. Income is a legal term for federal tax purposes. Income has been defined in several US Supreme Court tax decisions that income is the result of government granted privilege activity, and this activity is in wages paid out to the federal employee and some of that income must be “RETURNED” to the Government, thus the “RETURN’, a form of kickback. American citizens and corporations operating outside of the United States jurisdiction have no tax liabilty whatsoever. Why pay the tax even if you want to pay voluntarily? First of all, you will be committing a felony, because you will be falsely admittting to having federal income while you do not, so don’t commit perjury. If you file and should make a mistake, even if it’s a honest mistake, the IRS may think you were trying to evade some of the tax and they may prosecute you criminally. Just say NO to the federal tax and when you get that letter from the IRS why you did not file a 1040 statement (not a return), just tell them you are no longer going to lie and admit to having something you do not and besides you cannot be absolutely sure that everything is true and correct to the best of your belief and knowledge. The buck stops here. Bye bye IRS and hello pocket full of my hard earned money!

  2. BOB says:

    IN 1945 FDR STARTED SOC. SEC. WITCH STATED NO TAXES ON SOC, SEC, ALL PUT IN SPECIAL TRUST FUND FOR SOC.SEC, ONLY. CONGRESS IM THERE STUPID WISDOM MADE TRUST INTO GENERAL FUND, & EVERY STARTED TO TAKE MONEY FOR EARMARKS, & BEST OF ALL BILL CLINTON SIGNED A LAW TO TAX SOC, SEC, 85% , THAT JACK ASS DOSEN’T PAY SOC. SEC. THATS THE STUPIDEST THING I EVER HEARD OFF. IF THAY WOULD HAVE LEFT IT ALONE THERE WOULD BE PLENTY ON MONEY IN SPECIAL FUND FOR , LEAVE IT TO CONGRESS TO F— UP EVERY THING.

  3. JIM says:

    It should be a Flat Tax 10% Federal 5% Social Security and Medicare Tax, 5% State Tax – mandatory payroll deduction, employers responsibility to deduct from payroll for everyone. That will relieve IRS and State Tax personnel, to focus on collections, rather than waste their time auditing returns.

  4. LRudy says:

    If you want to talk discrimination, singles being in a higher tax bracket just because they are single is the biggest form of discrimination. No one will take it up as a cause because singles are a minority.

    Nothing is reduced for the sake of singles. Singles pay the same mortgage payments and car payments as anyone else. Nothing is lowered just because of single status.

    Buying groceries for singles is a joke. If one buys in smaller quanities, they pay more.

    Singles expenses are just as much as any other person. Singles should not be discriminated against by being put in a higher tax bracket.

    • jim says:

      I don’t understand, married couples are punished for being married because the brackets are double the rates of singles. Singles aren’t being discriminated against, married couples are. (from a tax perspective)

    • Joesph says:

      Jim, your an idiot. No offense. The dollar ammounts of the tax brackets are higher when married. This means a married couple can make more money than a single person and still be taxed the same percent. Example: A single person making $40,000 gets taxed 25% where as a couple making $40,000 gets taxed only 15%.

      To LRudy, this is because married couples have more expenses so a single person in the situation above needs less of the $ than a married couple. That’s why their taxes are cheaper.

  5. gayle says:

    My boyfriend and I are planning to get married – honestly just didn’t get around to it and are wondering if it is beneficial to step it up and do it before Jan 1. He has no deductions and makes $95k; I made roughly $48k and have a 17 year old and mortgage interest of $16k and line of credit interest of $3800 YTD. If I am correct, he will remain in the 28% tax bracket either way; currently I am in the 25% bracket. Can anyone help – will it make that much difference if we marry and file joint or remain single for the rest of this year. He is claiming single, 0 deductions. I have paid roughly $3700 in federal tax. If I’m reading paystub correctly I am claiming single 6 deductions for federal and single 4 deductions for state. Thanks for your help all!!!

    • jim says:

      I’m not a tax expert so I don’t know… call up an accountant. It’s really just your income and your deductions that matter.

    • Joesph says:

      When married you are not required to file jointly. You can each still file seperately. The idea of filing jointly is that for a good number of couples, the tax bracket might be lowered. As an example a single filer pays 25% on $40k where as if he filed as married would pay only 15% assuming the wife doesn’t work.

  6. Nancy says:

    Does anyone know why the IRS set the following the tax rate from 10% ->15%-> 25%->28%->33%->35%?

    A 10% increase from 15% to 25%, really hurts the net earning. Generally, college students with a bachelor degree would earn income between $33,950 to $82,250. Even if you max out your 401K contribution, you still have to pay 25% on the remaining amount. This tax rate truly puts the poor people away from middle class. It appears as it is a penalty for an average person who try to make its way up. Why can’t there be a tax bracket of 20% added between 15% to 25%?

    BTW, the gross earning is taken out by around 30% for ALL taxes (fed, state, social, etc)?

    Tax is our dutie to pay for a better government and society. However, it should be a fair practice.

  7. BOB MORROW says:

    WHAT HAPPENED TO THE CHART FOR THOSE WHO ARE 65 AND OLDER , NO CHART IN 2008 TAX BOOKLET,CHART WAS IN 2007 TAX BOOKLET,$12,800.00, DID I MISS SOMETHING?????

  8. Marie says:

    Curious if anyone can answer this for me. I got married this year, in May. My husband has a tax lien from a few years ago and I have 3 children. I have always gotten a large tax return with earned income credit, and now I need to know if we have to file a joint return which I think will put us in too high of a category for earned income credit ($60k total between us), or if there is a loophole for me to file my own return since for half the year we weren’t married? Married filing separately doesn’t let you qualify for earned income credit for some reason. Help please or we won’t see any return this year!

    • Eric says:

      Marriage status is determined by whatever your marriage status was on 12/31/07. If you were married on 12/31, then your status is married. If you were single on 12/31, then your status is single.

  9. Kathy says:

    My husband just qualified for SS Disability. It was paid in 1 lump sum for the 4 year period that he waited with all the appeals, etc. The tax info he got has the amount of each year that he earned individually. Can we pay this in back taxes, so our income this year won’t be so much?

  10. andi says:

    It must be nice to be able to complain about making 150k a year, wow this year me and my husband have been fortunate enough to make 15,000 between the two of us. we have two kids and have to scrimp every day. The job market sucks and there is nothing we can do but suck it up and watch the rich get richer. We are both high school graduates with a bad string of luck. For all you fortunate, remember that there are people like my family out here that have to choose between electric and mortgage every month.

    • Sam says:

      Andi, I know exactly where you are coming from. I feel for you. 5 Years ago I had a good job and 3 days before my son was born I got laid off, for 3.5 years I worked 2 Part time jobs because no one was hiring full time. A year and a half ago a good job opened up at a local College and I got it. Keep looking there is something out there for you and it will be there when you least expect it. I probably will never earn 150k a year but that’s ok I have a beautiful wife and 2 healthy beautiful children. Your bad string of luck will stop. Best wishes to you and your family!

      • Ron says:

        Andi I understand also. Wife was laid off from a part-time job and together we made $30,000. s last year. I changed jobs 1yr4mo ago and my pay alone now 2008 was $31,000. driving a city bus.

        All those making $150,000. and more good job. There are many more trying to hang in there.

        We will see if there is trickle down money.

  11. Mike says:

    I am a father, single parent, filing HOH, and making $108k/yr. I want to know where I stand if I get a second job in the coming months to eliminate a credit card I have. I heard that I can’t be HOH if I take a second job. How will that effect my return in 2009? Also, how much can I earn before I find myself in a higher tax bracket? Thanks in advance for your time.

    • Joesph says:

      That’s crazy. Someone needs to be the head of household. There’s no logical reason that 2 jobs or even more would change that. According to this year you can make up to $131,450 before being bumped to the next bracket, though that number ought to be higher next year.

  12. Julio says:

    Does anybody has an idea where I can find the list of all possible deductions for a married couple filing jointly?
    Julio

  13. Anonymous says:

    Maybe try searching google? But anyway guys, this up to 35% income tax is dreadful. All said and done, making 100k turns out being a lot less after income tax. I don’t have a job, I’m just talking about people who do.

    God, 33% out of 100,000? That amounts to about 66,000. Did you forget bills? Electric, Water, Insurance, Auto, Medical, Credit Card, yearly tax…. Oh and subtract all the money you spend each year on going shopping.

    Its sad that even if you get a payraise, the taxed income will just end up near what it was before.

  14. meohmyoh says:

    Ok guys let me give you a good one…. I have a friend or I think ex-friend by now. He is a cop, has a wife and two kids. He will not work any overtime. He does this for a reason. He then will qualify for his kids to get the state vouchers to go to private school for free! It also qualifies his kids for a state insurance called Healthy Kids and what that doesn’t cover then he can go apply for what is called a temporary medicaid to pick up the rest of the bill if there is some health need and large bill. He could get insurance through his job for his entire family but he gets free insuance for himself at work and his kids get this $15 a month insurance. His wife is not covered at all lol. And I might add she does not go to the doctor lol. Okay and if that isn’t bad enough… his wife got WIC (which is a gov thing to get free foods for your children (and baby formula) until they are 5 years of age) …. okay well they road that horse until their kids were too old. Ok then… he works side jobs and has it worked out with a friend that if he gets caught he is to say he is working for him under his license ID number. These jobs are CASH jobs only… so no taxes are paid on that. He has a house and a large chunk of land where he lives. He and his wife have new vehicles. He goes on hunting trips with friends each year in state and out of state(NOT CHEAP). They get back a nice income tax return every year (between 4 and 5 thousand a year)!!!! AND TO REALLY GET YOUR ATTENTION … If they think their income is going to be over the limit to get state vouchers to send their kids to private school for FREE then they put more of his check from his cop job in retirement!!!!!!! GO FIGURE GET REWARDED FOR PUTTING MORE MONEY AWAY FOR RETIRMENT. Really pizzez me off when people get by with this crap! My husband works his butt off and has no money put away and my kid can’t get a free voucher for school because my husband makes too much LMAO! So you see they have got it all figured out and they get by with it! Then his wife will say ohhhh we are having such a hard time making ends meet. We have to put more money away in retirement so our kids get a good Christian private school education (FREE), LMAO.

    • Benedict says:

      Good for them. Policy makers in Washington have made me lose all faith in our government. We live in a society now that you really can’t rust anyone. Government, Insurance, heck every company you deal with is in your pocket with no shame. I took a distribution on a 401K account in order to house my wife, 18 month old, and 6 month old. I am floored by the taxation on it, although I was expecting it. I’m in sales and that put me in a tax bracket that greatly accelerated my taxes, not to mention the 10% penalty. I am now committing myself to finding every way possible not to pay taxes…legally. The way I see it, I’ve paid enough, and it just gets squandered. Notice I said legally through use of deductions. Heck, If I just didn’t pay my taxes at all, I have a better than average chance of becoming a Presidential Staff appointee. Wouldn’t that be great. No one is on our side…no one. Every lobby in Washington is set up some how to get into your pocket. No one advocates for us, No one. To the guy who wants to get a second job to pay a credit card…do this: Get a book on tax law. Legally find and exploit every loop hole you can…make that your job and have fun doing it. When Nancy Pelosi can sit in front of everyone and say with a straight face that condoms needs to be provided in this 800 billion dollar bailout mistake…that’ when I’m out. People say that we are responsible for our part of the national debt…not me I didn’t okay any of this bs. I didn’t sign off on it. So I am going to study how to eliminate my participation in it. I’ll donate to our troops via USO or something (wow another tax deduction!!)

  15. Chad says:

    My son is taking on his first job. He anticipates making about $5,000 in 2009. Should he claim Exempt on his W4 because he won’t owe any Federal taxes in 2009? Doesn’t the $3,500 personal exemption mean that his first $3,500 in taxes are waived?

  16. christina-lynn says:

    Hello everyone, i have some issues, first of all, ive been married 9yrs, during this 9 yrs be and my husband have only lived under the same roof, for about 2 yrs, we have remained married tryin to work through things, and we always end up getting back together, and then a month or two we are living apart again, i have only worked maybe 2 jobs for a very short period of time and didnt make very much maybe total of 3400.00 each time which were different years, and so since we had two children together, and ive had some issues, our children have remained in the home with there father, who has filed head of household evvery year, well last yr, i ended up getting pregant, and we tried working things out again, and have moved into the same home together to see if it will finally work out since we are both so much older and now have three kids, my ? is since my husband filed head of house all those years, and i never filed on when i worked, because i was told you had to make 5000.00 or more a year, this year he filled married filling seperartly since we are living together now, will they audit him? and me for not filling on the time i worked? thank you so much and god bless

  17. Hopper says:

    I’m confused on my taxes. I have 2 jobs and when I enter my W-2 info for my first job it says i get a refund of around $1,200. Then I enter my second W-2 and my refund gets cut in half. I don’t think I changed tax brackets this year and I don’t know what to do. Any help would be awesome.

  18. Bailey says:

    I have just had a hopefully temporary pay cut that has put me in the 15% tax bracket. If I can still make ends meet would I be stupid to get a part time job that would throw me back into the 25% tax bracket?

    • saladdin says:

      That’s not how tax brackets work. You should really research marginal/effective tax rates. Besides that, income tax is not 100%. Why would you not want more income?

      saladdin

    • Babar says:

      Probably not Bailey.

      Here is how it works… You are taxed based on your adjusted gross income (meaning after all deductions). Say you max out at $32551 last year which puts you $1 into the 25% bracket. You would then pay 10% on the first $8025 (so $802.5) then 15% on the next $24,525 [$32550-$8025 = $24,525) (so $3,678.75), and finally 25% on the last $1. So it isn’t bad to reach the next tax bracket in this scenario.

      This would be a problem in certain cases, such as IRA distributions where you are taxed at your highest marginal rate (25%) for the full amount of the distribution… and these distributions can raise your rates.

  19. US Engineering says:

    Various politicians think that playing with our money will get us where we need to be,wrong wrong wrong.Does Anybody know history? Remember the labor movement when this country had prospered building the Panama canal,the empire state building,the railroad,etc,these acts where deliberate and everyone worked from a vision. Right now the only politician whith one would be the President.Correcting the info structure is a big start.Without a vision of where we are going to the future these corrections to our bridges,roads,and tunnels will be the waste of another generation. Mr President,citizens of the US there is only one way we wre going to come out of this.National Monorail System System.Clean,fast,dependable,and plenty of work for all.

  20. bob says:

    this year i just made some good money aroun150000. we are filing jointly and i have a year old kid. how do i save taxes? please advice

  21. Monika says:

    My husband annual income is about 14000$ plus he got little store that has income 8500$ how can i check what is a max income for him if i dont work and he claims me?

  22. Kam says:

    My mom, who is retired and living in Utah, took out a $20,000 Reverse Mortgage on her home. Does she have to pay any Federal or State Taxes on that? Her income consists of Social Security and my Fathers Military Pension (I think). Thanks, I appreciate any info that I could get.

  23. Jane says:

    I made around 30K in 2009, I am single and have 1 child. I filed exempt for the first part of the year, so how much federal tax SHOULD have been taken out and will I owe? (hypothetically)

  24. Jane says:

    I will have made around 30000 for 2009, I claimed exempt for the first part of the year. How much should have been withheld? I am single and have 1 child. Will I owe…I’m freaking out.

  25. Anonymous says:

    I’m married and been filing jointly. My husband is in the military and they take out alot from him. With his W-2 and mines, we always get a refund less than $400. Why is that?


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