Your effective tax rate is the share of your income that goes to tax. It is lower than your marginal bracket because each rate applies only to a slice of income. Enter your income above to see both.
How to calculate your effective tax rate
- Start with gross income.
- Subtract the larger of the standard deduction or your itemized deductions to get taxable income.
- Apply the bracket rates slice by slice to find federal income tax.
- Divide total tax by gross income.
Effective vs marginal tax rate
| Gross pay | Taxable income | Federal income tax | Effective rate | Marginal rate |
|---|---|---|---|---|
| $40,000 | $23,900 | $2,620 | 14.2% | 12% |
| $80,000 | $63,900 | $8,770 | 18.6% | 22% |
| $120,000 | $103,900 | $17,570 | 22.3% | 22% |
| $200,000 | $183,900 | $36,734 | 25.5% | 24% |
| $400,000 | $383,900 | $103,134 | 30.5% | 35% |
Single filer, 2026, standard deduction.
Use the effective rate to compare years, jobs or states. Use the marginal rate to decide what an extra dollar of income, or a pre-tax contribution, is worth.