How it works
Federal tax is progressive: each slice of taxable income is taxed at its bracket's rate. First find taxable income:
Taxable income = gross − pre-tax deductions − standard deduction
Then apply the 2025 bracket rates (10%, 12%, 22%, 24%, 32%, 35%, 37%) to each portion that falls within each band. Your marginal rate is the bracket your last dollar lands in; your effective rate is total tax ÷ gross income.
Worked example
Single filer earning $80,000, 2025:
- Taxable income = 80,000 − 15,000 (standard deduction) = $65,000
- Federal tax ≈ $9,214 · effective rate ≈ 11.5% · marginal bracket 22%