WASHINGTON—The threshold for the top federal income-tax bracket in 2022 will climb by nearly $20,000 next year for married couples, and that 37% rate will apply to income above $647,850, the Internal Revenue Service said Wednesday as it implemented automatic tax-code updates to reflect faster inflation in 2021.
For individuals, that top tax bracket will start at $539,900. Those levels increased 3.1% from tax year 2021 due to automatic inflation adjustments built into the tax code, and the other tax bracket break points will rise as well. Due to increases in consumer prices, all of the tax bracket thresholds and other key tax-code parameters are rising faster than usual.
