How to Use This Tool
Enter your income and filing status. The three rates shown are all correct and they answer different questions, which is most of why this is confusing.
The raise myth
"I got a raise and it pushed me into a higher bracket, so I take home less." This cannot happen, and the arithmetic is short enough to check.
Brackets are marginal. A rate applies only to the dollars inside its band, never to your whole income. Crossing from the 22% band into the 24% band at $105,700 of taxable income:
- At $105,000 taxable, the tax is $17,812 and you keep $87,188.
- At $106,000 taxable, the tax is $18,038 and you keep $87,962.
The extra $1,000 cost $226 in tax — $700 at 22% plus $300 at 24% — and added $774 to take-home pay. There is no income at which an extra dollar leaves you worse off under the federal income tax.
What can happen is a benefit cliff: losing a credit, a subsidy or an income-tested benefit entirely at a threshold. Those are real and they are not brackets. If someone genuinely lost money from a raise, look for a cliff, not for the tax table.
Three rates, three questions
On $100,000 gross for a single filer taking the standard deduction:
- Marginal rate, 22%. What the next dollar costs. The right number for deciding whether to make a deductible contribution, take overtime, or realise income this year.
- Effective rate on taxable income, 15.70%. Total tax divided by taxable income.
- Effective rate on gross income, 13.17%. Total tax divided by everything you earned. The honest answer to "what percentage do you pay".
People quote whichever they heard last, which is why "I'm in the 22% bracket" and "I pay 13% in tax" are both true statements from the same person.
Which rate to use for a decision
Almost always the marginal one. A $1,000 deductible retirement contribution at a 22% marginal rate saves $220, not $132. The effective rate describes what already happened; the marginal rate prices what you are about to do.
The exception is comparing years or comparing yourself with someone else, where the effective rate on gross income is the only figure that means the same thing to both parties.
What this leaves out
Federal income tax only. Missing entirely:
- Payroll tax — 7.65% of wages up to the Social Security wage base, and the employer pays the same again. For most earners it is a larger bill than people realise.
- State and local income tax, which ranges from nothing to over 13%.
- Credits, which reduce tax directly rather than reducing income, and phase out in ways that create their own effective rates.
- Capital gains and qualified dividends, taxed on a separate schedule.
- The Alternative Minimum Tax and the additional Medicare and net investment income taxes at higher incomes.
Figures here are for tax year 2026 and change every year. This is arithmetic for understanding how brackets work, not tax advice — take an actual filing decision to a tax professional.
