Income Tax Calculator

The United States federal income tax system is progressive — meaning the tax rate increases as your taxable income rises. This does not mean all of your income is taxed at the highest rate you reach. Instead, your income is divided into brackets, and each bracket's rate applies only to the income that falls within that range. For 2024, the tax brackets for single filers are: 10% on income up to $11,600; 12% on income from $11,601 to $47,150; 22% on income from $47,151 to $100,525; 24% on income from $100,526 to $191,950; 32% on income from $191,951 to $243,725; 35% on income from $243,726 to $609,350; and 37% on all income above $609,350.

One of the most persistent misconceptions about the tax system is the idea that earning more money can leave you worse off by pushing you into a higher bracket. This is mathematically impossible under a progressive system. If your income crosses into the 22% bracket, only the dollars above the previous bracket ceiling are taxed at 22% — every dollar below that threshold continues to be taxed at the lower rates that applied before. A dollar of additional income is always worth something after tax, regardless of which bracket it falls in.

The marginal rate — the rate applied to your last dollar of income — is distinct from your effective rate, which is the actual average percentage of your total income paid in tax. A single filer with $60,400 in taxable income sits in the 22% marginal bracket, but their effective federal rate is well below 22% because the first layers of income were taxed at 10% and 12%. Knowing both figures is important: your marginal rate determines the value of any deduction, while your effective rate shows your true overall tax burden and helps with accurate budgeting.

Your taxable income is not the same as your gross income — it is the figure remaining after a series of deductions. The first step is to compute your Adjusted Gross Income (AGI) by subtracting above-the-line deductions from gross income. These include contributions to a traditional IRA (up to $7,000 for 2024), student loan interest paid (up to $2,500), and contributions to Health Savings Accounts (HSAs), among others. These deductions reduce your AGI without requiring you to itemize, making them accessible to nearly all taxpayers regardless of their home ownership status.

From your AGI, you subtract either the standard deduction or itemized deductions — whichever is larger. For 2024, the standard deduction is $14,600 for single filers and $29,200 for married couples filing jointly. Itemized deductions include mortgage interest, state and local taxes (capped at $10,000 combined), charitable contributions, and qualifying medical expenses above 7.5% of AGI. Roughly 90% of taxpayers now claim the standard deduction because it exceeds their itemized total, particularly after the 2017 Tax Cuts and Jobs Act nearly doubled the standard deduction amount.

To illustrate with a concrete example: a single filer earning $75,000 in gross salary with no above-the-line deductions has an AGI of $75,000. Subtracting the $14,600 standard deduction leaves a taxable income of $60,400. This is the figure on which federal income tax is actually calculated — not the $75,000 gross income. Many people are surprised to discover that their actual tax bill is much lower than they expected once they realize their entire gross income is not their taxable income.

Let us work through a complete federal income tax calculation for a single filer with $75,000 in gross income and no above-the-line deductions. First, subtract the 2024 standard deduction: $75,000 minus $14,600 equals $60,400 in taxable income. Now apply the tax brackets progressively from the bottom up, taxing only the income that falls within each bracket's range.

Step one: 10% on the first $11,600 equals $1,160. Step two: 12% on the income from $11,601 to $47,150 — that is $35,550 multiplied by 12% — equals $4,266. Step three: 22% on the income from $47,151 to $60,400 — that is $13,250 multiplied by 22% — equals $2,915. Adding these three amounts: $1,160 plus $4,266 plus $2,915 equals a total federal income tax bill of $8,341.

With $8,341 in tax on $75,000 of gross income, the effective tax rate is $8,341 divided by $75,000 — approximately 11.1%. This is the actual share of gross income going to federal income tax, far below the 22% marginal rate. The marginal rate of 22% means that each additional dollar of income — or each dollar of deduction — is worth 22 cents in tax savings or cost. If this filer contributes $5,000 to a traditional IRA, that deduction alone saves $5,000 multiplied by 22%, or $1,100 in federal taxes.

Tax credits are more valuable than deductions of the same dollar amount because they reduce your tax bill directly — dollar for dollar — rather than reducing your taxable income. The Earned Income Tax Credit (EITC) is among the most generous available: for 2024, eligible low-to-moderate-income workers can receive up to $7,430 with three or more qualifying children. The Child Tax Credit provides $2,000 per qualifying child under age 17, with up to $1,600 of that amount refundable even if your tax liability is zero. The American Opportunity Tax Credit offers up to $2,500 per student per year for qualified higher education expenses in the first four years of college, with 40% of that amount refundable.

Deductions, while less powerful than credits of the same size, can still meaningfully reduce your bill. Contributions to a traditional 401(k) are pre-tax, reducing your gross income before any calculation begins — a $5,000 contribution from someone in the 22% bracket effectively costs only $3,900 out of pocket after the tax savings. Traditional IRA contributions of up to $7,000 may be deductible depending on your income and access to an employer plan. Mortgage interest and state and local taxes — up to $10,000 combined — can make itemizing worthwhile for homeowners in high-tax states, though a careful comparison against the standard deduction is always needed.

Understanding the distinction between above-the-line deductions (which reduce AGI and are available to all filers regardless of whether they itemize), below-the-line deductions (which are only accessible by itemizing), and credits (which directly reduce tax owed) is essential to effective tax planning. Maximizing above-the-line deductions such as IRA contributions and HSA contributions should be the first priority for most taxpayers, since they reduce both AGI and taxable income — and in doing so can sometimes open access to other credits and deductions that phase out at higher AGI levels.

In addition to federal income tax, most Americans also owe state income taxes, which layer directly on top of federal liability. Nine states currently levy no income tax on wages: Florida, Texas, Washington, Nevada, Wyoming, South Dakota, Alaska, Tennessee, and New Hampshire. Residents of these states retain more of each paycheck and can hold a meaningful advantage in after-tax income compared to residents of high-tax states at equivalent gross salaries. This tax difference is one of the factors driving population migration from high-tax coastal states toward lower-tax alternatives in recent years.

At the opposite end of the spectrum, California imposes the highest top marginal state income tax rate in the nation at 13.3% on income above $1 million, with rates beginning at 1% and reaching 9.3% at income above approximately $66,000 for single filers. New York's top rate reaches 10.9% for very high earners, with a 6.85% rate applying from $215,400. Combined with the 37% top federal rate and applicable payroll taxes, high earners in these states can face total marginal rates exceeding 50%. Oregon, Minnesota, and New Jersey also rank among the states with the highest top rates.

State income tax structures vary widely: some states such as Colorado and Illinois use a flat rate applied equally to all income levels, while others like California and New York use progressive brackets that mirror the federal system's structure. Many states allow deductions that parallel federal rules, though with their own limits and phase-outs. When comparing job offers across state lines or evaluating a potential relocation, factoring in state income tax alongside federal income tax, property tax, and sales tax gives a far more accurate picture of your true take-home pay than looking at federal taxes alone.