When is Tax Day 2025? Everything You Need to Know About Deductions, Income Brackets, Credits, and Deadlines
Tax season for 2025 is approaching. Many Americans are beginning to prepare their tax returns, while some are still putting it off.
Here are answers to frequently asked questions as April 15 draws near.
What is the tax deadline for 2025?
The tax deadline is April 15. Tax Day is consistently set for this date, unless it coincides with a weekend or holiday. In 2025, it lands on a Tuesday.
Can the IRS provide free tax preparation assistance?
Absolutely. A number of taxpayers in several states can prepare and file their 2024 federal income tax returns online via the Direct File program. Additionally, the IRS Free File program offers complimentary tax filing to those with limited income.
The Direct File initiative, which was piloted last year, will expand to 24 states this year. The IRS has described Direct File as a secure and free solution for Americans with relatively straightforward taxes. This software enables taxpayers to verify their calculations and ensure they are maximizing their potential refunds.
What are the updated income tax brackets?
The following are the tax brackets for 2024, which will apply to taxes filed in 2025.
Income tax operates on a progressive system: the more income you earn, the higher the percentage you pay in taxes. Each bracket specifies a range of incomes subjected to a specific tax rate.
For the highest individual tax bracket, the 2024 income threshold has risen to $609,350. Earnings above this figure incur the maximum tax rate of 37%.
Here are the other 2024 tax brackets for individual taxpayers:
- 35% for incomes exceeding $243,725.
- 32% for incomes exceeding $191,950.
- 24% for incomes exceeding $100,525.
- 22% for incomes exceeding $47,150.
- 12% for incomes exceeding $11,600.
- 10% for incomes at or below $11,600.
And here are the 2024 tax brackets for married couples filing jointly:
- 37% for incomes over $731,200.
- 35% for incomes exceeding $487,450.
- 32% for incomes exceeding $383,900.
- 24% for incomes exceeding $201,050.
- 22% for incomes exceeding $94,300.
- 12% for incomes exceeding $23,200.
- 10% for incomes at or below $23,200.
What is the updated standard deduction?
For 2024, the standard deduction stands at $14,600 for individuals and $29,200 for married couples filing jointly.
What is the standard deduction for seniors?
Individuals aged 65 and older are eligible for an additional standard deduction. For 2024, this amounts to $1,950 for singles or heads of household, and $1,550 for married taxpayers.
Have itemized deductions altered?
According to Intuit TurboTax, no new tax deductions will be available in 2024. Itemized deductions “remain largely unchanged” for the year, as reported by Charles Schwab. A few specifics include:
- State and local taxes: Taxpayers opting for itemized deductions may deduct up to $10,000 in property, sales, or income taxes already paid to local or state governments.
- Mortgage interest: Generally, interest paid on the first $750,000 of mortgage debt can be deducted, as stated by NerdWallet. Homebuyers who acquired property before December 16, 2017, may still deduct interest on the first $1 million.
- Medical expenses: Only medical and dental expenses surpassing 7.5% of your adjusted gross income are eligible for deduction.
What is the Social Security tax limit for 2024?
A limit exists on how much of your earnings the Social Security Administration can tax at a rate of 6.2%. (Self-employed individuals incur a rate of 12.4%.)
For 2024, earnings above $168,600 are exempt from Social Security taxes. In 2025, this “wage base limit” will increase to $176,100, meaning you can retain more of your earnings beyond that threshold.
What are the new contribution limits for IRA and 401(k)?
For those involved in employer-sponsored retirement plans, the contribution limit for a 401(k) in 2024 is generally set at $23,000. Individuals not participating in such plans can contribute $7,000 to an IRA.
For 2025, the limits will rise to $23,500 for 401(k) contributions and remain at $7,000 for IRAs.
Individuals aged 50 and over have the option of contributing more. Starting in 2025, those ages 60 to 63 may also make higher “catch-up” contributions.
What are the new health savings account (HSA) contribution limits?
HSA contribution limits for 2024 are $4,150 for individual coverage and $8,300 for family coverage, according to Fidelity. In 2025, these limits will increase to $4,300 and $8,550.
What is the income threshold for child tax credits?
The child tax credit for 2024 is available for up to $2,000 per qualifying child, as noted by NerdWallet. This credit reduces in value if your modified adjusted gross income surpasses $200,000, or $400,000 for couples filing jointly.
What distinguishes filing as single versus head of household?
You can claim “Head of Household” status if you are unmarried or single and maintain a household that includes a child or relative. This filing status offers a higher standard deduction and more favorable tax rates, according to H&R Block.
Where can I find a tax refund estimator?
Services such as TurboTax, H&R Block, NerdWallet, and AARP provide tax refund estimators.
Where is my refund?
In most cases, you can expect your tax refund within a month or less. The IRS claims that most refunds are processed within 21 calendar days. However, refunds from paper returns may take four weeks or longer. Allow additional time for the refund check to arrive in your bank account or mailbox.