How to use the income tax calculator
The page has two tools. Tax & brackets calculates your federal income tax for the year and breaks it down bracket by bracket. Tax on a raise shows how much of extra income you keep.
- Filing status. Use the status from your federal return. It sets the standard deduction and the width of every bracket.
- Gross income. Add up wages, self-employment profit, interest, ordinary dividends, short-term gains and other taxable income for the year. Pay stubs and 1099 forms are the sources. Use wages before 401(k) deductions: box 1 of the W-2 already has them taken out, and the calculator subtracts them in the next step.
- Pre-tax deductions. Traditional 401(k) and 403(b) contributions, HSA contributions and deductible IRA contributions. These come off before tax is worked out.
- Qualified dividends and long-term gains. Optional. These get their own lower rates, so keep them out of gross income and enter them here.
- Deduction. Keep the standard deduction, or switch to itemized and enter your Schedule A total.
The results show your tax, your bracket, two effective rates and income left after tax. The table and chart show how much of your income sits in each bracket and what each slice costs.
How income tax is calculated
The US taxes income in slices. Each bracket’s rate applies only to the income that falls between its lower and upper limits:
Taxable income = Adjusted gross income − Standard or itemized deduction
Income tax = Σ (Income inside each bracket × That bracket's rate) + Tax on preferential incomePreferential income is qualified dividends and long-term capital gains, stacked on top of ordinary income and taxed at 0%, 15% or 20%. Brackets run from 10% to 37%; figures are for tax year 2026.
Effective rate on gross income = Income tax ÷ Total income
Effective rate on taxable income = Income tax ÷ Taxable incomeThe effective rate on gross income is the better measure of your overall tax burden; the rate on taxable income shows the blended bracket rate.
A worked example
A single filer earns $85,000 and puts $7,500 into a 401(k) and an HSA. After the $16,100 standard deduction, taxable income is $61,400.
The first $12,400 is taxed at 10%, the slice up to $50,400 at 12%, and the remaining $11,000 at 22%. Together that is $8,220.00 of federal income tax.
The filer is in the 22% bracket, yet the effective rate is only 9.7% of gross income (13.4% of taxable income). Income left after income tax and pre-tax savings is $69,280.00, before Social Security and Medicare. There is $44,300 of room before the 24% bracket begins.
Adding $10,000 of qualified dividends raises the bill to $9,720.00. The dividends add $1,500.00 of tax, a flat 15% here, and the tax on the wages stays at $8,220.00.
Why a higher bracket only taxes the extra dollars
A common worry is that a raise will “push you into a higher bracket” and cost you money. It cannot, because the higher rate applies only to the income above the bracket line. Everything below it is taxed exactly as before.
In the Tax on a raise tool, a single filer earning $95,000 gets a $15,000 raise. The raise stays inside the 22% bracket, so extra tax is $3,300.00 and $11,700.00 is kept. A bigger $40,000 raise crosses into the 24% bracket: only the part above the line is taxed at that rate, the overall tax rate on the raise is 22.3%, and $31,086.00 is kept.
The effective rate rises gradually with income, while the marginal rate climbs in steps:
| Gross income (single, $7,500 pre-tax) | Income tax | Marginal rate | Effective rate |
|---|---|---|---|
| $40,000 | $1,720.00 | 12% | 4.3% |
| $60,000 | $4,120.00 | 12% | 6.9% |
| $85,000 | $8,220.00 | 22% | 9.7% |
| $150,000 | $22,934.00 | 24% | 15.3% |
| $250,000 | $48,904.00 | 32% | 19.6% |
| $500,000 | $135,509.25 | 35% | 27.1% |
Even at $500,000, the effective rate stays well below the 35% marginal rate, because the first few hundred thousand dollars are taxed at the lower rates.
Which rate to use for which decision
- Marginal rate for decisions at the edge: a raise, overtime, a side job, a Roth conversion, or the value of a deduction. In the 22% bracket, a $1,000 deduction saves $220 of federal tax.
- Effective rate for budgeting and comparisons: it tells you what share of your income goes to federal income tax overall.
- Pre-tax contributions save tax at your marginal rate. Without the $7,500 of 401(k) and HSA contributions, the example filer’s tax would be $9,870.00 instead of $8,220.00.
Filing status matters too. With the same income on a joint return, the tax falls to $4,940.00, because the joint standard deduction of $32,200 and the brackets are twice the single figures for most incomes. If both spouses work, enter the combined income for the household bill.
What this calculator does not include
- Payroll taxes. Social Security and Medicare come on top; the salary after tax calculator includes them, and the self-employment tax calculator covers the self-employed version.
- Tax credits. The Child Tax Credit, education credits and the Earned Income Tax Credit reduce the tax after it is calculated.
- State and local income tax, the alternative minimum tax and the 3.8% net investment income tax.
- Phase-outs and other deductions, such as the qualified business income deduction, student loan interest and income-based limits.
Treat the result as an estimate of your regular federal income tax for 2026.