Tax season is back and people have already begun scrambling to figure out what they owe and how to pay the government. Luckily, online resources have made calculating your federal tax rates a much simpler process than you or your parents might remember.
Today, you can leave your calculator and abacus aside and just visit TaxAct, a tax preparation software that offers a free online tool for figuring out the amount of tax expected of each bracket of income. There are seven brackets: 10 percent, 15 percent, 25 percent, 28 percent, 33 percent, 35 percent and 39.6 percent. Remember, your entire income is not taxed at the rate of the highest bracket you reach.
For example, if you are married, filing jointly and making between $75,301 and $151,900, then you'll pay 10 percent on the first $18,550 of your income, 15 percent on everything between $18,551 and $75,300 and then 25 percent on everything between $75,300 and $151,900. If you filed for $100,000 of taxable income in this case, then you would add $1,855 from the first tax bracket, $8,512.50 from the second tax bracket and, finally, $6,175 from what remains in the last bracket. The result should equal $16,542.50 of tax, or 16.54 percent of your income.
This tax rate will vary if you are single or married and filing separately. A number of other factors could also affect what kind of deductions, exemptions and tax credits you are eligible for. Check out the federal government's official information website, USA.gov, to determine which form is best for you and what kind of conditions may apply to your situation. You can also choose to file online here.
The 2017 tax filing season began Jan. 23 and this year's deadline is April 18, moved from the traditional April 15 date because it fell on a Saturday. The IRS said it expected to receive over 150 million returns.
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