Taxes calculators

US federal tax is progressive, which means a rate applies only to the income inside its band. Being pushed into the 24% bracket does not tax your whole income at 24%, it taxes the dollars above that threshold, so on this schedule alone a raise can never leave you with less. Elsewhere in the system it can: benefits, health insurance subsidies and some credits phase out over a narrow income range, and those cliffs are real. The rate that matters for a decision is the marginal one, on the next dollar. The rate that describes your year is the effective one, across all of it.

A payslip subtracts in a fixed order: pre-tax deductions first, which lower the income that gets taxed, then federal income tax, then Social Security and Medicare, then state tax, then anything post-tax. Social Security stops once your wages pass the annual cap; Medicare never does, and gains an extra 0.9% at higher incomes. This is a close estimate, not the exact figure on your payslip, which also depends on the allowances on your W-4.

Hold an asset for more than a year and the profit is taxed at the long term rates of 0%, 15% or 20%. Sell sooner and it is taxed as ordinary income, at up to 37%. Those long term bands stack on top of your other income, which is why the same gain costs different people very different amounts. Losses offset gains, and up to $3,000 of net loss can come off ordinary income each year.

An employee splits Social Security and Medicare with their employer. Work for yourself and you are both halves, which is why the rate is 15.3% rather than 7.65%. Two things soften it: only 92.35% of profit is charged, standing in for the employer share an employee never sees, and half the tax comes off your income before income tax is worked out. This uses 2026 rates and covers self-employment tax alone, not the income tax on the same profit, which the federal income tax calculator handles. State and local tax is not modelled, and a handful of cities charge their own tax on self-employment as well. Retirement contributions to a SEP-IRA or solo 401(k) lower your income tax but do not lower this, since the charge is on net earnings before those go in.

Tax in the US is pay as you go. An employee satisfies that through withholding; everyone else sends it in four installments, and missing them costs an underpayment penalty even if the whole balance is settled by April. The safe harbors are the useful part: pay 90% of this year's tax, or 100% of last year's (110% if last year's AGI was over $150,000), and no penalty applies however large the eventual bill. Last year's figure is the safer target because it is already known. This projects 2026 federal income tax and self-employment tax from the standard deduction only, so itemized deductions, credits, retirement contributions and state estimated payments are all missing, and each of them moves the number. Income that arrives unevenly can be annualized on Form 2210 instead of split into four equal parts.

You take the standard deduction or you itemize, never both, so itemizing is worth the paperwork only when your deductible costs clear the standard figure. Since the standard deduction roughly doubled in 2018 most households never get close. What matters is not the size of the gap but the tax on it: an extra $1,000 of deduction is worth $1,000 times your marginal rate, which is why the headline here is the tax difference. Figures are for 2026. The SALT cap of $40,400 phases down above roughly $505,000 of MAGI, at 30 cents per dollar and never below $10,000, which this does not model. State income tax is not modelled either, and several states let you itemize there even when you take the federal standard deduction, so the two choices are not always the same one.

A health savings account is the one place in the tax code with three exemptions at once: the contribution comes off your income, the growth is never taxed, and withdrawals for medical costs are never taxed either. Contribute through payroll and it escapes Social Security and Medicare tax as well, which no 401(k) does. The catch is eligibility: you need a qualifying high deductible health plan, and you must stop contributing once Medicare starts. Money spent on this year's prescriptions never compounds, so the account works hardest when you pay medical costs from cash and leave the balance invested. After 65 a non-medical withdrawal is taxed as ordinary income with no penalty, which makes it a traditional IRA with a better door. Figures are 2026 limits. State tax is estimated at a flat rate, and California and New Jersey do not recognize HSAs at all, so set that rate to zero in those two states to see the federal saving alone.

A credit comes off the tax itself, which makes it worth far more than a deduction of the same size: $2,200 of credit is $2,200, while $2,200 of deduction is worth your marginal rate on it. The child tax credit is mostly non-refundable, so it can take your tax to zero but not below; only the additional child tax credit, capped at $1,700 a child and limited to 15% of earned income above $2,500, pays out beyond that. Figures are for 2026. The phase-out thresholds are fixed in statute and are not adjusted for inflation, so each year a few more families cross them. The tax before credits here is estimated from income and the standard deduction alone, so itemizing, retirement contributions or other credits will move it. State child credits are not included, and roughly a dozen states have one. Credits interact: the earned income credit, the child and dependent care credit and the premium tax credit all phase out over overlapping income ranges, and no single-purpose calculator can show that combined effect.

The earned income credit pays out even when no tax is owed, which makes it the largest cash transfer in the tax code. Its shape is the point: it rises with every dollar earned up to a plateau, sits flat across a band, then falls away. On the way up an extra dollar of work is worth more than a dollar; on the way down it is worth less, because part of the credit goes with it. That is a real marginal rate of roughly 16% to 21% on the phase-out slope, on top of ordinary tax. Figures are 2026. This uses the greater of earned income and AGI for the phase-out, as the statute does, and ignores the rules a real return still has to pass: a childless claimant must be between 25 and 64, a qualifying child must meet age, residency and relationship tests, and investment income above $12,200 disqualifies the credit outright. Around thirty states add their own earned income credit as a percentage of the federal one, and none of that is included.

Withholding is a guess your employer makes from the W-4 you filled in, and it goes wrong whenever your year is not a flat twelve months of the same salary: a raise, a bonus, a second job, a working spouse, a few months unemployed. Checking in the middle of the year leaves time to fix it, because the correction is spread over the paychecks that are left rather than landing in April. Landing near zero is the target. A large refund is your own money returned without interest; a large bill can carry an underpayment penalty. This covers 2026 federal income tax only. Social Security and Medicare are withheld separately at fixed rates and never end up over or under, and state withholding runs on its own schedule and is not modelled. Credits are not modelled either, and a credit you are entitled to makes the real result better than this shows.

Selling an investment that has fallen turns a paper loss into a deductible one. It offsets realized gains dollar for dollar, then up to $3,000 of ordinary income a year, and anything left carries forward with no expiry. The trap is the wash sale rule: buy the same or a substantially identical security within 30 days either side of the sale and the loss is disallowed, added to the basis of the replacement instead. Thirty days before counts as well as thirty after, an automatic dividend reinvestment triggers it, and a purchase in your IRA or your spouse's account triggers it too, in which case the loss is gone for good rather than deferred. The usual way round it is to buy a different fund tracking a similar but not identical index. This is a deferral more than a saving: selling low resets your basis low, so the tax often comes back when you eventually sell the replacement. Figures are 2026 federal. State tax is not modelled, and several states do not allow the $3,000 ordinary offset at all.

A bonus is not taxed at a special rate. It is withheld at one. Payroll usually treats it as a supplemental wage and takes a flat 22% for federal income tax, 37% on anything past $1,000,000 in a year, plus Social Security and Medicare on top. At tax time the bonus is simply added to your income and taxed at your real marginal rate, so if that rate is below 22% the difference comes back as a refund, and if it is above, you owe more. Employers may instead use the aggregate method, which pretends the bonus is your normal paycheck and withholds accordingly, and that usually takes even more. Figures are 2026 federal. State tax is not included and most states run their own supplemental rate. A 401(k) deferral or an HSA contribution taken from the bonus lowers the real tax and is not modelled here.