Tax Bracket Calculator | Calculate Your 2023 Tax Rate (2024)

The income tax bracket system, also known as the progressive tax system, is the IRS' attempt to make the American taxation system have the same impact on taxpayers at every income level. Typically, the IRS adjusts the rates each year due to rising inflation costs.Federal tax brackets are essentially income ranges with different taxation percentage rates. The higher your income is, the higher the federal income tax rates are. Knowing which tax bracket your income falls into can help you to lower your taxable income and the taxes you pay.If your filing status is single, and you have taxable income of $100,000 for the year from your dog grooming business, for example, you would fall into the $95,376 to $182,100 income bracket for 2023, and your tax rate would be 24%. The good news is that not all your income is taxed at the 24% rate, just the earnings in the $95,376 to $182,100 range. The income is taxed at different rates that correspond to different income brackets. Sound confusing? FlyFin’s tried and true tax bracket calculator can show you the tax bracket you fall into without any need for calculations.

The percentage rate your overall income is taxed at is your effective tax rate. It can be calculated by taking the tax the IRS charges you and dividing it by your total earnings for the year.Total tax ÷ adjusted gross income = effective tax rateEveryone has a different effective tax rate based on their income and the deductions they take from their taxable income. It's the amount you pay in taxes divided by your earnings before taxes. An effective tax rate calculator can help you figure out how much you’ll owe.Say you have a side job doing landscaping. If you made $40,000 in a year in total before taxes, and paid $10,000 in tax, your effective tax rate would be 10,000 divided by 40,000. This works out to .25, or 25%.

With a marginal tax rate system, taxpayers are divided into tax brackets, and their income is taxed based on their tax bracket. With every payment you receive from working, you’ll reach a different bracket as your overall income increases.Parts of your income might fall into different tax brackets than other parts. The last dollar of income you’ve earned in the highest tax bracket that is referred to as your marginal tax rate. The tax rate charged on the first dollar you earn at the start of the year will likely be far lower than the tax rate charged on the last dollar you earn in the year. The higher your annual adjusted income is, the higher in general your marginal tax rate will beWith the Tax Cuts and Jobs Act, the IRS set the tax rates at 10%, 12%, 22%, 24%, 32%, 35% and 37%.The IRS has set seven tax brackets 2022 taxpayers will fall into. The lowest 2022 tax bracket, or the lowest income level, is $0 to $10,275. It’s taxed at 10%, which means the first $10,275 of the money you made that year is taxed at 10%.

Tax rateSingleMarried, filing jointlyMarried, filing separatelyHead of household

10%$0 - $10,275$0 - $20,050$0 - $10,275$0 - $14,650

22%$41,776 - $89,075$83,551 - $178,150$14,776 - $89,075$55,901 - $89,050

24%$89,076 - $170,050$178,151 - $340,100$89,076 - $170,050$89,051 - $170,050

32%$170,051 - $215,950$340,101 - $431,900$170,051 - $215,950$170,051 - $215,950

35%$215,951 - $539,900$431,901 - $647,850$215,951 - $323,925$215,951 - $539,900

37%$539,901 or more$647,851 or more$323,926 or more$539,901 or more

In October 2022, the IRS announced the adjustments for the 2023 tax brackets, meaning taxes filed in 2024. The same seven tax rates for the 2022 tax year are still being used, 10%, 12%, 22%, 24%, 32%, 35% and 37% but the 2022 and 2023 tax brackets are different. So you could fall into the 22% tax bracket in 2022 by making $42,000 and the 12% tax bracket in 2023 with the same income level, if your filing status is single.

Tax rateSingleMarried, filing jointlyMarried, filing separatelyHead of household

10%$0 - $11,000$0 - $22,000$0 - $11,000$0 - $15,700

12%$11,001 - $44,725$22,001 - $89,450$11,001 - $44,725$15,701 - $59,850

22%$44,726 - $95,375$89,451 - $190,750$44,726 - $95,375$59,851 - $95,350

24%$95,376 - $182,100$190,751 - $364,200$95,376 - $182,100$95,351 - $182,100

32%$182,101 - $231,250$364,201 - $462,500$182,101 - $231,250$182,101 - $231,250

35%$231,251 - $578,125$462,501- $693,750$231,251 - $346,875$231,250 - $578,100

37%$578,126 or more$693,751 or more$346,876 or more$578,101 or more

One of the best ways to get your income into a lower tax bracket is by taking self-employment tax deductions. Deductions and tax credits to lower your taxable income, and there are many different tax deductions and credits, like the food and entertainment deduction, subscription-related tax deductions and the education tax credit.What is taxable income? Also known as adjusted gross income, this is the amount of income before any tax is applied and after all deductions and tax credits have been taken.Tax credits can be very helpful for students, for example, who might be working a freelance job while getting an undergraduate degree. If they earned $45,000 in adjusted gross income, they would just barely be in the 22% federal tax bracket for 2023.If they qualified for the American opportunity credit and received the full $2,500 tax credit for expenses such as tuition and books, the credit would be able to lower their income by that amount. As a result, their adjusted gross income would go to $42,500, putting them in the 12% tax bracket, and they would end up paying less in taxes.

As someone self-employed, your income isn’t withheld from an employer, and you’ll need to make estimated tax payments quarterly on your income. If you expect to owe $1,000 or more in taxes, you’ll be expected to make IRS payments. Calculating accurate estimated payments is important because the IRS could charge an underpayment penalty, and no one wants to give the IRS any more money than needed.When you’re on a payroll, your employer pays half the Medicare and Social Security. If you’re self-employed, the IRS considers you to be both the employer and the employee, and it’s up to you to pay the total 15.3% tax. Find out how your income gets taxed with this quick 1099 tax calculator.Keeping track of income and expenses, finding deductions and calculating federal tax brackets for 2023 can be overwhelming. You can use an app like FlyFin for this and manage your expenses and income, too, all in one place. No need to keep track of receipts or use spreadsheets. Instead, A.I. finds every possible deduction, saving you time and money. You’ll never miss another business deduction or pay the IRS more than you need to again.