US Tax Brackets Calculator
Estimate your federal income tax based on current IRS tax brackets
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Frequently Asked Questions
For the 2023 tax year, there are seven federal tax brackets: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. Your bracket depends on your taxable income and filing status.
Total income includes all your earnings from various sources. Taxable income is your total income minus deductions and exemptions. It's the amount actually used to calculate your tax liability.
Your marginal tax rate is the rate at which your last dollar of income is taxed. Your effective tax rate is the average rate you pay on all your taxable income (total tax divided by taxable income).
Tax brackets are adjusted annually for inflation. Major changes to the tax code require legislative action by Congress, which happens less frequently.
Yes, long-term capital gains (on assets held more than one year) are taxed at preferential rates of 0%, 15%, or 20%, depending on your taxable income and filing status.
Understanding US Tax Brackets: A Comprehensive Guide
The United States uses a progressive tax system, which means that as your income increases, the tax rate on additional income also increases. This system is structured into tax brackets, with each portion of your income being taxed at a corresponding rate.
How Tax Brackets Work
Many taxpayers misunderstand how tax brackets function. If you move into a higher tax bracket, only the income above the threshold for that bracket is taxed at the higher rate, not all of your income. This is an important distinction that prevents people from being financially penalized for earning more money.
For example, if you're a single filer in 2023 with $50,000 of taxable income, you wouldn't pay 22% on all $50,000. Instead, you'd pay:
• 10% on the first $11,000
• 12% on the amount between $11,001 and $44,725
• 22% on the amount over $44,725
2023 Tax Brackets
Here are the official tax brackets for the 2023 tax year:
Single Filers
• 10%: Up to $11,000
• 12%: $11,001 to $44,725
• 22%: $44,726 to $95,375
• 24%: $95,376 to $182,100
• 32%: $182,101 to $231,250
• 35%: $231,251 to $578,125
• 37%: Over $578,125
Married Filing Jointly
• 10%: Up to $22,000
• 12%: $22,001 to $89,450
• 22%: $89,451 to $190,750
• 24%: $190,751 to $364,200
• 32%: $364,201 to $462,500
• 35%: $462,501 to $693,750
• 37%: Over $693,750
Understanding Your Tax Situation
Knowing your marginal tax bracket can help with financial planning decisions, such as whether to contribute to traditional versus Roth retirement accounts, when to realize investment gains, and how to time income and deductions.
It's also important to remember that this calculator estimates federal income tax only. Most states also impose income taxes, with rates ranging from 0% to over 13% in California. Seven states have no income tax at all: Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming.
Tax Planning Strategies
Understanding tax brackets allows you to employ strategies like:
• Income shifting: Deferring income to years when you expect to be in a lower tax bracket
• Bunching deductions: grouping deductible expenses into a single year to exceed the standard deduction threshold
• Tax-loss harvesting: Selling investments at a loss to offset capital gains
• Retirement contributions: Contributing to traditional accounts to reduce current taxable income
While this calculator provides a good estimate of your federal income tax liability, everyone's tax situation is unique. For personalized advice, consult with a qualified tax professional.