The U.S. tax department — known as the IRS — has shared its yearly updates for the 2025 tax year. These changes are made to adjust for inflation. In simple words, when prices go up, tax rules need to change too, so people don’t pay extra just because things have become more expensive.

This update might sound like it only affects U.S. citizens, but many Indians who earn income in the U.S., work there, study, or invest in U.S. assets also come under these rules. At Tech Bullion, we’re sharing the key updates in simple language so you can understand how this could affect your money.

What Is Tax Inflation Adjustment?

Each year, the IRS makes changes in the tax system to match inflation. Without these updates, you could pay more tax just because your salary went up a little, even though your lifestyle stayed the same.

These changes apply to things like:

Income tax slabs (tax brackets)
Standard deductions
Tax credits
Limits on gifts or estates
Overseas income exclusions

The goal is to give small relief to taxpayers without changing the entire tax system.

New Standard Deductions for 2025

Let’s begin with the standard deduction — this is the part of your income you don’t have to pay tax on.

Here’s what it looks like for 2025:

Single persons: ₹15,000 (up from ₹14,600 in 2024)
Married couples filing jointly: ₹30,000 (earlier ₹29,200)
Heads of household: ₹22,500 (up from ₹21,900)

So, if you earn ₹85,000 as a single filer, you only need to pay tax on ₹70,000 after this deduction. The new amounts help save a bit more compared to last year.

Updated Tax Brackets for 2025

Your income is taxed in slabs or brackets. In 2025, these brackets are shifting slightly upward. That means more of your income will fall in lower-tax slabs, and you might pay a bit less overall.

Some examples:

The 10% tax rate now applies to income up to ₹11,925
The 12% rate is for ₹11,926 to ₹48,475
The 22% rate goes from ₹48,476 to ₹103,350
Higher rates like 24%, 32%, and 35% also now start at higher incomes

This is helpful because even if you get a salary hike, you may not jump into a higher tax slab too quickly. That saves money.

For Indians earning or reporting income in the U.S., this shift is good news. You’ll keep more of your income.

Other Tax Updates Worth Knowing

Here are a few more changes announced for 2025 that could matter to you or someone you know:

1. Gift Tax Limit Increased

You can now give up to ₹19,000 to someone in a year without it being taxed. This was ₹18,000 in 2024.

2. Estate Tax Exemption Raised

The new exemption is ₹13.99 million (₹1.39 crore), which is up from ₹13.61 million. This matters if you’re planning to pass on assets to family.

3. Foreign Income Exclusion

For those living and working abroad, ₹130,000 of foreign income can now be excluded from tax — an increase from ₹126,500.

These updates affect NRIs, Indian students working in the U.S., and even families handling inheritance matters across borders. At Tech Bullion, we cover these topics regularly in plain language so you don’t miss anything important.

Example: How Rohan Saved Tax in 2025

Let’s say Rohan is an Indian software engineer working in Texas. In 2024, he made ₹90,000 and filed as a single person. Thanks to the standard deduction and new bracket changes in 2025, he might pay ₹700–₹1,000 less in taxes this year — without doing anything special.

These changes may not sound big, but over time, they can make a difference. That’s why we at Tech Bullion suggest staying informed, even if you’re not filing your return just yet.

Why Should You Care?

You should care about these changes if:

You or someone in your family works in the U.S.
You invest in U.S. stocks, property, or mutual funds
You plan to study or settle in the U.S.
You manage joint assets across countries
You help someone file U.S. tax returns from India

Even small updates can affect how much you owe, how much you save, and how you should plan for the year.

Final Thoughts from Tech Bullion

IRS updates can seem confusing at first, but they’re meant to help. The 2025 changes aim to make sure people don’t end up paying more tax just because things cost more. This is especially useful for Indians who are part of the global financial world.

At Tech Bullion, we simplify such updates and bring you only what matters — in a language you understand. Whether you are a student, a salaried person, a business owner, or just planning ahead, these small tax changes can help you plan better.

Keep checking Tech Bullion for more tax updates, finance news, and smart tips made for Indian readers. We’re here to make things easy — without using hard words or confusing terms.

IRS Tax Changes for 2025: What Indian Taxpayers Should Know