For the 2025 fiscal year, the United States Internal Revenue Service (IRS) has introduced several updates to income tax brackets. This measure primarily aims to adjust for inflation, and reflect changes in the economy.
Deductions and thresholds
One of the most notable changes for U.S. taxpayers is the increase in standard deductions compared to 2024. For single taxpayers and married individuals filing separately, this standard deduction increases to $15,000. For married couples filing jointly, it increases to $30,000. For heads of households, the deduction increases to $22,500.
The progressive income tax brackets have been adjusted for inflation, resulting in updated limits. The tax brackets for 2025 are as follows:
Changes on exemptions
Furthermore, exemptions over Alternative Minimum Tax (AMT), which is applied to high income taxpayers, are also reformed. The economic dispensation rises to $88,100, although it is phased out at the highest income level. Finally, married couples filing jointly can claim an exemption up to $137,000, which phases out at $1,252,700.
Inflation and the change of president in the U.S. will generate numerous changes in the U.S. tax system. Therefore, count on us to manage the payroll of your multinational or investment fund in the United States.
About Auxadi
Auxadi offers international accounting, tax, payroll and legal services to multinationals and funds in more than 50 jurisdictions, with 22 subsidiaries worldwide. Our experience and global presence allow us to offer tailored tax solutions, ensuring efficient management in compliance with local regulations.
Can Auxadi help?
Auxadi can become your ideal partner. We offer a one stop shop value added outsourcing services in the areas of accounting and reporting, tax compliance, payroll management and representation services, among others.
Local Knowledge – International Coverage
Founded in 1979, Auxadi is a family-owned business working for multinational corporations, private equity funds and real estate funds. It’s the leading firm in international accounting, tax compliance and payroll services management connecting Europe and the Americas with the rest of the world, offering services in 50 countries. Its client list includes many of the top 100 PERE companies. Headquartered in Madrid, with offices in US and further 22 international subsidiaries, Auxadi serves 1,500+ SPVs across 50 jurisdictions.
All information contained in this publication is up to date on 2024. This content has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice.No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this content, and, to the extent permitted by law, AUXADI does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.