How to Determine Your Federal Tax Bracket
Let me introduce you to the Browns. The Browns like to go out and live a fairly lavish lifestyle with at least two vacations a year and a new car every two years. As a married couple, the Browns make $90,000 (after deductions) which puts them in a certain tax bracket with the Internal Revenue Service. How much tax will they pay on that income? Let's find out.
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Instructions
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Compute your total taxable income. This is for filing IRS Form 1040. The amount you put on line 43 of the form is the taxable income the IRS will use to determine your tax bracket. For the Browns, this amount is $90,000.
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Download the current tax table (see Resources).
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Find the column for married filing jointly (as Mr. and Mrs. Brown are filing as a married couple). If you are filing as single, then look up the amount next to the tax status for single.
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Look up the IRS' current tax table for income of $90,000. For 2009, the table reads, "Single," "Married filing jointly," "Married filing separately" or "Head of a household" and lists a tax of $18,927, $14,881, $19,339, or $17,359, respectively. The amount shown where the taxable income line and filing status column meet is $19,339 for the Browns. This is the tax amount they enter on Form 1040, line 44.
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Tips & Warnings
Be sure to use the taxable income on line 43 of the IRS form to determine your tax rate. Line 43 is not your annual salary, but the portion of it on which you are taxed. See the instructions for Form 1040 for more information.
