Income Tax Estimator

The US federal income tax system is progressive — higher income is taxed at higher rates, but only the portion of income within each bracket. This is a common misunderstanding: moving into a higher bracket does not mean all of your income gets taxed at that higher rate.

The calculation flow: start with gross income, subtract your deduction (standard or itemized) to get taxable income, then apply each bracket rate to the income within that range. The sum of all bracket calculations is your total federal tax liability.

For 2025, the standard deductions are $15,000 (single), $30,000 (married filing jointly), and $22,500 (head of household). These reflect inflation adjustments from the 2024 figures. The brackets themselves are also inflation-adjusted each year by the IRS.

The effective tax rate — total tax divided by gross income — is what you actually pay as a percentage of earnings. For most middle-income Americans, effective federal income tax rates range from 8% to 16%. The marginal rate matters primarily when evaluating incremental decisions: whether a raise pushes you into a higher bracket, whether a Traditional IRA deduction saves you more than a Roth contribution would cost.