income tax bracket
Definition
- Noun:
- A category of taxpayers based on the amount of their income: An "income tax bracket" is a range of incomes subject to a particular tax rate. Tax systems often use progressive brackets, where higher income levels are taxed at higher rates.
Usage Examples
- Noun:
- Moving into a higher income tax bracket means you will pay a larger percentage of your earnings.
- The new law created an additional income tax bracket for ultra-high earners.
- You need to know your income tax bracket to estimate your tax liability accurately.
Advanced Usage
"To fall into a bracket": To belong to a specific income tax category.
- With her promotion, she now falls into the 32% income tax bracket.
"Bracket creep": A situation where inflation pushes taxpayers into higher income tax brackets even though their real purchasing power hasn't increased.
- The government adjusted the brackets to prevent bracket creep.
Variants and Related Words
Tax bracket (n): A common shortened form of "income tax bracket".
- What is your current tax bracket?
Marginal tax rate (n): The rate of tax applied to the last dollar of income within a given bracket.
- Your marginal tax rate is determined by your top income tax bracket.
Synonyms
- Tax band: (Used primarily in British English) A category of income taxed at a particular rate.
- Tax rate schedule category: A more formal term for a division within the tax rate structure.
Related Phrases
- "To be in the same bracket": To have a similar level of income (and thus be in the same tax category).
- Economically, many small business owners are in the same tax bracket.
Notes on Meaning
The term specifically refers to the category or range itself, not the rate or the amount of tax. It is a key component of a progressive tax system where tax rates increase as taxable income increases across predefined brackets.
Noun
- a category of taxpayers based on the amount of their income
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