Income Tax Calculator

Your marginal tax rate is the rate applied to your last dollar of income — the highest bracket you fall into. Your effective tax rate is the average rate you pay across all your income, calculated by dividing total tax owed by total gross income. Most people pay an effective rate significantly lower than their marginal rate due to the progressive bracket system.

AGI is your total gross income minus specific above-the-line deductions such as retirement contributions, student loan interest, and health savings account (HSA) contributions. AGI is the starting point for calculating taxable income after standard or itemized deductions are applied. A lower AGI can also help you qualify for more tax credits and deductions.

For 2025, the standard deduction is $15,000 for single filers, $30,000 for married filing jointly, and $22,500 for head of household. You should itemize only if your qualifying deductions — such as mortgage interest, charitable contributions, and state/local taxes (SALT, capped at $10,000) — exceed the standard deduction. Most taxpayers benefit from taking the standard deduction.

Tax credits directly reduce the amount of tax you owe, dollar for dollar. Deductions reduce your taxable income, which then lowers your tax. For example, a $1,000 tax credit saves you $1,000 in taxes, while a $1,000 deduction saves you $220 if you're in the 22% bracket. Common credits include the Child Tax Credit, Earned Income Credit, and education credits.

Your refund is simply the difference between what was withheld from your paychecks and what you actually owe. If your withholding was too high, you get a refund; if too low, you owe. Life changes like a new job, marriage, a child, or investment income can all shift your tax liability significantly. Updating your W-4 with your employer can help you fine-tune withholding.

FICA stands for Federal Insurance Contributions Act and consists of Social Security tax (6.2% on wages up to $176,100 in 2025) and Medicare tax (1.45% on all wages, plus an additional 0.9% for income over $200,000 for single filers). Most W-2 employees have FICA automatically withheld. Self-employed individuals pay both the employee and employer share, totaling 15.3%, but can deduct half as a business expense.

The IRS typically issues refunds within 21 days of accepting your electronically filed return. Paper returns can take 6 to 8 weeks. Filing early, choosing direct deposit, and avoiding errors on your return are the best ways to speed up your refund. You can track the status of your refund using the IRS 'Where's My Refund?' tool.

Yes. Self-employment and 1099 income is fully taxable and is also subject to self-employment tax (15.3% for Social Security and Medicare). Unlike W-2 employees, no tax is withheld automatically, so you're generally required to make quarterly estimated tax payments to the IRS to avoid underpayment penalties.