How federal income tax works in 2026
The United States taxes income in brackets. Each rate applies only to the slice of taxable income that falls inside its bracket, so moving into a higher bracket never makes your whole income taxed at the higher rate. This calculator uses the 2026 brackets and standard deductions published by the IRS in Revenue Procedure 2025-32, which reflect the One Big Beautiful Bill Act and inflation adjustments. It applies to income earned in 2026, reported on returns filed in 2027.
From gross income to tax
- Adjusted gross income (simplified) = gross income − pre-tax contributions such as a traditional 401(k), HSA and health premiums.
- Taxable income = adjusted gross income − the larger of the standard deduction and your itemized deductions.
- Tax = the sum of each bracket rate × the income inside that bracket.
- Child tax credit: $2,200 per child under 17, reduced by $50 for each $1,000 of income above $200,000 ($400,000 married filing jointly).
2026 standard deduction
| Filing status | Standard deduction |
|---|---|
| Single or married filing separately | $16,100 |
| Married filing jointly | $32,200 |
| Head of household | $24,150 |
2026 brackets (taxable income)
| Rate | Single | Married filing jointly | Head of household |
|---|---|---|---|
| 10% | up to $12,400 | up to $24,800 | up to $17,700 |
| 12% | to $50,400 | to $100,800 | to $67,450 |
| 22% | to $105,700 | to $211,400 | to $105,700 |
| 24% | to $201,775 | to $403,550 | to $201,775 |
| 32% | to $256,225 | to $512,450 | to $256,200 |
| 35% | to $640,600 | to $768,700 | to $640,600 |
| 37% | above | above | above |
Worked example: single, $85,000
A single filer earns $85,000 and puts $6,000 into a traditional 401(k).
- Adjusted gross income: 85,000 − 6,000 = $79,000.
- Taxable income: 79,000 − 16,100 = $62,900.
- Tax: 10% of 12,400 = $1,240, plus 12% of 38,000 = $4,560, plus 22% of 12,500 = $2,750, for $8,550.
- Effective rate: 8,550 ÷ 85,000 = 10.1%, while the marginal bracket is 22%.
- FICA adds $6,503, so about $63,948 remains after federal tax and payroll tax, before state tax.
Effective rate and marginal rate
The marginal rate is what you pay on your next dollar of income; use it to judge a raise, a bonus or a pre-tax contribution. The effective rate is your total tax divided by your income; use it for budgeting. In the example, each extra $1,000 contributed to a 401(k) saves $220 of federal tax.
What this estimate leaves out
The calculator covers the common case of wages and ordinary income. It does not include capital gains and qualified dividends, which have their own rates, the alternative minimum tax, other credits such as education or child care credits, the new deductions for tips, overtime and seniors, or state income tax. For a return with these items, use tax software or a professional, and check your withholding with the IRS Tax Withholding Estimator.