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Understanding Tax Brackets and Tax Rates: What's Changed in the 2024 Tax Brackets

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Understanding Tax Brackets and Tax Rates: What's Changed in the 2024 Tax Brackets

Tax season can be a stressful time for both individuals and businesses. As they work to follow the ever-changing tax laws and regulations, it can become overwhelming to stay up-to-date with everything. An important part of those updates is the IRS income tax brackets for 2024.

Table of contents

What are the new tax brackets for 2024?...Read more

Will the tax brackets be the same for business entities?...Read more

How do you calculate your tax bracket?...Read more

How can you reduce your taxable income?...Read more

Additional deductions and exclusions for freelancers...Read more

What are the new tax rates for 2024?...Read more

What are the new tax brackets for 2024?

The new IRS tax brackets for 2024 were released early last year. Let’s explore the two types of taxes that individuals may qualify for and examine the extent of the changes compared to the previous year.

1. Federal Taxes

2. State taxes

Will the tax brackets be the same for business entities?

For businesses, the 2024 tax brackets will vary depending on the type of entity and the amount of income earned. Corporations will be subject to a flat tax rate of 21%, while pass-through entities like partnerships and S corporations will be subject to individual tax rates as mentioned above. It is important to note that when filing your taxes, you must refer to the tax brackets announced for the previous year. For instance, if you are filing taxes in 2024, you should apply the tax brackets announced for 2023. Similarly, if you are filing for 2025, you must refer to the 2024 tax brackets.

How do you calculate your tax bracket?

First, you must understand that you don’t pay taxes on your entire income, taxes are applied only on your taxable income.

What is taxable income?

How can you reduce your taxable income?

Knowing how to reduce your taxable income can lead to significant tax savings.

Standard deduction

Itemized deductions

Claiming tax credits

Additional deductions and exclusions for freelancers

Freelancers can take advantage of certain additional deductions and exclusions to reduce their taxable income further

Qualified Business Income Deduction

Annual exclusion for gifts

What are the new tax rates for 2024?

Did you know that the amount of tax you owe is based on your taxable income and filing status? It's true! Knowing your tax rates and how they are applied can help you plan and prepare for tax season. Even though the tax rates change sometimes due to various economic, political, and budgetary requirements, they have remained the same in the last 5- 6 years.

Understanding your effective tax rate

How to calculate your effective tax rate

2024 Tax Filing

The tax filing deadline for the 2024 tax year is April 15, 2025. This is also the last day to file a tax extension. FlyFin is the best online tax filing tool for the self-employed.

2024 Tax Laws

Tax laws are always changing. FlyFin’s expert CPAs can monitor these changes and help you navigate them while handling your filing process and lowering your tax bill.

2024 Estimated Tax Payments

Self-employed individuals have to make estimated tax payments to the IRS if they owe over $1,000. These payments are due throughout the year. Missing them can lead to penalties.

Tax Brackets - 2023 Vs 2024

The new 2024 tax brackets have higher income thresholds as they are adjusted for inflation. Freelancers can lower their tax bracket by writing off business deductions.

2024 Self employment Tax

Self-employment tax is paid by self-employed individuals who earn over $400. The self-employed tax rate is 15.3% of net earnings. Use tax deductions to lower taxes.

2024 IRS Mileage Calculator

The IRS mileage rate in 2023 was 65.5 cents/mile. In 2024, it was increased to 67 cents/mile. Self-employed individuals can also write off mileage-related tax deductions.

2024 Tax Credits

Tax credits reduce tax liability. There are many tax credits available to taxpayers. FlyFin’s CPAs can help you navigate the process.

2024 Tax Filing

The tax filing deadline for the 2024 tax year is April 15, 2025. This is also the last day to file a tax extension. FlyFin is the best online tax filing tool for the self-employed.

2024 Tax Laws

Tax laws are always changing. FlyFin’s expert CPAs can monitor these changes and help you navigate them while handling your filing process and lowering your tax bill.

2024 Estimated Tax Payments

Self-employed individuals have to make estimated tax payments to the IRS if they owe over $1,000. These payments are due throughout the year. Missing them can lead to penalties.

Tax Brackets - 2023 Vs 2024

The new 2024 tax brackets have higher income thresholds as they are adjusted for inflation. Freelancers can lower their tax bracket by writing off business deductions.

What’s FlyFin?

FlyFin caters to the tax needs of freelancers, gig workers, independent contractors and sole proprietors. But anyone can file taxes through FlyFin! FlyFin tracks all your business expenses automatically using A.I. technology. Then, our CPA team files a guaranteed 100% accurate tax return for you – to save you a couple thousand dollars and a ton of time on your taxes. In addition, you can download the FlyFin app and have your taxes filed in less than fifteen minutes, saving time and money.
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