Tax Bracket Law and Legal Definition
Tax bracket refers to the limit in one’s income for taxation. Tax brackets determine the amount of tax to be paid, depending on the income of a particular person. For example, in the U.S. the Tax brackets are divided into 3 rates namely,10 percent, 20 percent, and 50 percent. Therefore, the income range which demands a particular tax rate is known as the tax bracket. There is no tax to be paid until a certain sum of annual income but surpassing that, one will enter the tax bracket. Tax brackets largely depend on the taxable income that does not include the source of that income.
