Marginal Tax Rate Calculator
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|Average tax rate||This is your total income divided by your total Federal tax. The average tax rate is almost always lower, sometimes by a wide margin, than your income tax bracket or marginal tax rate.|
|Income tax bracket||This is the highest Federal income tax bracket used in calculating your total Federal tax. This is calculated by looking up the highest Federal income tax bracket that includes your taxable income.|
|Marginal tax rate||This is the percentage paid in Federal taxes on additional income. To determine your marginal tax rate, the tool recalculates your total Federal income tax using your current income plus an additional income amount. The additional income amount is $1,000 for incomes under $100,000 and $10,000 for incomes over $100,000. We then divide the difference between your original Federal tax and the recalculated Federal tax by the amount of additional income. Your marginal tax rate captures the effect of additional income taxed in higher income brackets and the phase-out of deductions and credits.|
|Married Filing Jointly||If you are married, you are able to file a joint return with your spouse. If your spouse died during the tax year and you did not remarry, you are still able to file a joint return for that year. You may also choose to file separately under the status "Married Filing Separately".|
|Qualified Widow(er)||Generally, you qualify for this status if your spouse died during the previous tax year (not the current tax year) and you and your spouse filed a joint tax return in the year immediately prior to their death. You are also required to have at least one dependent child or stepchild for whom you are the primary provider.|
|Single||Use this filing status if you don't qualify for any other filing status. Generally, If you are divorced, legally separated or unmarried as of the last day of the year (and you are not using another filing status) you should use this status.|
|Head of Household||This is the status for unmarried individuals (or individuals considered unmarried) that pay for more than half of the cost to keep up a home for qualifying individuals who live with the taxpayer for more than one-half of the year. (The taxpayer's dependent parent does not have to live with the taxpayer but can still qualify provided you pay over half of the cost of keeping up the parent's home.). This home needs to be the main home for the income tax filer and at least one qualifying relative. You can also choose this status if you are married, but didn't live with your spouse at anytime during the last six months of the year. You also need to provide more than half of the cost to keep up your home and have at least one dependent child living with you.|
|Married Filing Separately||If you are married, you have the choice to file separate returns. The filing status for this option is "Married Filing Separately".|
|Filing Status||Maximum AGI for Full Credit||AGI No Credit|
|Married Filing Jointly||$400,000||$50 reduction for every $1,000 over threshold|
|Qualified Widow(er)||$400,000||$50 reduction for every $1,000 over threshold|
|Single||$200,000||$50 reduction for every $1,000 over threshold|
|Heads of Household||$200,000||$50 reduction for every $1,000 over threshold|
|Married Filing Separately||$200,000||$50 reduction for every $1,000 over threshold|
Any interest paid on first, second or home equity mortgages over the limit is not tax-deductible. Only home equity loans that are used to buy, build or substantially improve the home that secures the loan are included. All other home equity loans do not have an interest deduction. Mortgage interest is reported on form 1098.
You can also include the amount you paid for "points" (which reduces your mortgage interest rate). Mortgage insurance premiums paid are no longer deductible.