US federal tax brackets are projected to rise by 3.2% in 2027, allowing Americans to earn more before moving into higher tax rates, according to estimates from Bloomberg Tax.
The Internal Revenue Service has not yet published its inflation-adjusted brackets, which it usually announces in October or November. The projections indicate a larger increase than the 2.7% adjustment applied for the current tax year.
The annual changes are intended to limit so-called bracket creep, in which workers receiving pay rises in line with inflation can be pushed into higher tax bands without an increase in their real spending power.
How the 2027 federal tax brackets could change
Under the Bloomberg Tax forecast, the 12% tax bracket for married couples filing jointly would cover taxable income from 25,601 US dollars to 104,050 dollars. The upper threshold would be 3,250 dollars higher than in 2026.
Only the portion of income within that band would be taxed at 12%, while taxable income below 25,601 dollars would remain subject to the 10% rate. Tax brackets for single filers are also expected to rise in 2027.
The standard deduction is projected to increase to 33,200 dollars for married couples filing jointly and 16,600 dollars for single filers. The corresponding amounts for the current tax year are 31,500 dollars and 15,750 dollars.
Bloomberg Tax based its projections on the chained Consumer Price Index, the inflation measure used by the IRS. It said the calculation relied on an 11-month average because October 2025 inflation data was not reported by the Department of Labor during the government shutdown.
The larger projected adjustment follows higher prices in 2026. The August Consumer Price Index showed annual inflation of 3.4%, while diesel prices rose above six dollars a gallon and petrol remained above four dollars a gallon.
The IRS has not immediately provided information on when it will announce the official inflation-adjusted tax brackets for the 2027 tax year.
