2027 Tax Brackets: Will Your Raise Push You Into a Higher Bracket?

If you’re expecting a raise in January, there’s a question that comes up every fall: will the extra money push you into a higher tax bracket and wipe out the gain? The short answer is no. The longer answer is worth knowing, because the 2027 brackets are about to shift and that changes how much of your raise you actually keep.

As of late October 2026, the IRS still hasn’t released its official 2027 inflation adjustments. Last year the agency published them on October 9, so this year’s package is running late (Main Street Dollars). But the formula is set by law, and the major tax publishers have already run the numbers. Here’s what they project and what it means for your paycheck.

The projected 2027 numbers

Both Thomson Reuters Checkpoint and Wolters Kluwer project the same key figures. The standard deduction would rise to:

• $16,600 for single filers, up from $16,100 in 2026
• $33,200 for married couples filing jointly, up from $32,200
• $24,900 for heads of household, up from $24,150

The bracket thresholds move up by roughly 3%. For a single filer, the projected 2027 brackets on taxable income look like this:

• 10% up to $12,800 (was $12,400)
• 12% up to $52,025 (was $50,400)
• 22% up to $109,125 (was $105,700)
• 24% up to $208,325
• 32% up to $264,550
• 35% up to $661,375, and 37% above that

For married couples filing jointly, the 12% bracket would run to $104,050 and the 22% bracket to $218,250. The rates themselves don’t change. Only the dollar cutoffs move.

Why these are still projections

The IRS sets the yearly adjustment using average inflation for the 12 months ending in August. The 2025 government shutdown left the Bureau of Labor Statistics unable to publish October 2025 inflation data, and that month can’t be recovered. The projections above use the 11 months that do exist. Tax professionals told Checkpoint the missing month should make little difference for most people (Thomson Reuters), but the official numbers could still land a few dollars off. Treat these as very good estimates, not final figures.

The bracket myth, cleared up

The U.S. uses marginal tax brackets. Crossing into a higher bracket only raises the rate on the dollars above the cutoff, not on your whole income. So a raise can never leave you with less take-home pay than you had before. A $2,000 raise that pushes $500 of your income into the 22% bracket costs you 22% on that $500 and 12% on the rest. You still come out ahead.

What a raise can do is get taxed at a higher rate than your average rate, which is why the extra money in your check often feels smaller than you expected. That’s normal, and it’s worth planning for rather than fearing.

A worked example

Say you’re single and earn $68,000 in 2026 with no other income and the standard deduction. Your taxable income is $51,900, which sits in the 22% bracket by $1,500. Your 2026 federal income tax comes to about $6,130.

Now say you get a 3.5% raise, which is close to what employers are budgeting for 2027 (see our 2027 raise forecast). Your pay rises to $70,380. Using the projected 2027 numbers, taxable income is $53,780, and federal income tax comes to about $6,373.

That’s roughly $243 more in federal income tax on a $2,380 raise, or about 10 cents per raise dollar. Because the brackets and standard deduction rose too, a big chunk of your raise is taxed at 12% instead of 22%. Without the inflation adjustment, the same raise would have cost noticeably more. Add Social Security and Medicare (7.65% combined) and any state tax, and you’ll keep somewhere around 80 cents of each raise dollar in this example.

The catch: a small raise can still be a pay cut

Brackets rising about 3% protects you from “bracket creep,” where inflation alone nudges you into higher taxes. But it also tells you something else: prices rose about 3% too. If your raise is smaller than that, you’re losing ground even after the tax help. This year’s Social Security cost-of-living adjustment is another useful yardstick, as we explained in why the COLA is your 2027 raise benchmark. If your offer comes in under those numbers, that’s a reason to push back.

Four moves to keep more of your 2027 raise

1. Send part of it to your 401(k). Pre-tax contributions come off your taxable income at your top rate. If part of your raise lands in the 22% bracket, putting that slice into a traditional 401(k) saves 22 cents on the dollar right away. Limits are expected to rise next year too (see our guide to 2027 401(k) limits).

2. Check your withholding in January. Your employer’s payroll system will switch to the 2027 tables once the IRS publishes them. Look at your first paycheck of the year and compare it to December’s. If something looks off, our guide on how to read your pay stub walks through each line.

3. Use open enrollment. Health savings accounts and flexible spending accounts also lower taxable income. If you’re picking a plan right now, run the numbers on whether a high-deductible plan with an HSA puts more money in your pocket.

4. Negotiate with after-tax numbers in mind. When you ask for a raise, think about what you’ll take home, not just the headline number. A 5% raise and a 3% raise are further apart after inflation than they look on paper, so the extra two points are worth asking for.

Bottom line

The projected 2027 brackets move up about 3%, which means most people will owe a bit less tax on the same real income next year. A raise will never cost you money because of brackets, but a raise below inflation still leaves you behind. Once the IRS releases its official figures, we’ll update this post if anything changes.

This article is general information, not tax advice. Figures for 2027 are projections from Thomson Reuters Checkpoint and Wolters Kluwer and may differ slightly from the IRS’s final numbers.