As a therapist or mental health professional, your salary can change fairly consistently, especially when operating as a sole proprietor or self-employed individual. This can be an added stressor or point of confusion come tax season––how do you figure out the rate at which you’ll be taxed?

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Not only is your salary, caseload and client list changing every year, but so are the tax brackets.

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Note: This article has been updated after the time of publishing to reflect information for those filing taxes for the 2023 tax year (in spring 2024).

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What are tax brackets?

Tax brackets are a system created by the IRS which define the amount of taxation you owe based on the amount of income you make as a therapist. These brackets change on an annual basis and are typically adjusted for inflation, meaning it’s important to check them every year to see which bracket you’ll fall into, and subsequently, how much you’ll be taxed.

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As a therapist, the bracket you fall into will be dependent on your taxable income, and how you are filing, whether that’s single, married filing jointly or as a widow(er), married filing separately or as a head of household. Generally, you’ll fall into one of seven primary "brackets" of income, defining your rate of taxation: 10%, 12%, 22%, 24%, 32%, 35%, or 37%.

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TurboTax offers an easy-to-use, estimated tax rate calculator on their website for the 2023 year.

2023 tax brackets and federal income tax rates

Below is a table of the 2023 tax brackets and federal income tax rates (for taxes filed in 2024).

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Tax brackets are foundational in your process of filing taxes as a private practice or small business owner, whether you're doing so as a sole proprietor, S corporation, self-employed individual or employee.

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Keep your eyes open for adjustments made to tax brackets on an annual basis and calculating your rate of taxation becomes easy in no time!‍

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This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult their own attorney, business advisor, or tax advisor with respect to matters referenced in this post.

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