How US Federal Income Tax Works
The US uses a progressive tax system — you only pay the higher rate on income above each bracket threshold, not on all income. Being in the 22% bracket does not mean you pay 22% on everything.
Taxable Income = Gross Income - Deductions
Tax = Sum of (income in each bracket x bracket rate)
2024 Brackets (Single Filer)
| Taxable Income | Rate |
|---|---|
| $0 - $11,600 | 10% |
| $11,601 - $47,150 | 12% |
| $47,151 - $100,525 | 22% |
| $100,526 - $191,950 | 24% |
| $191,951+ | 32-37% |
Frequently Asked Questions
Marginal rate is tax on your last dollar — your highest bracket. Effective rate is total tax / total income — your average. Use marginal rate for decisions like whether a deduction is worth it.
Take whichever is larger. In 2024, standard deduction is $14,600 (single) or $29,200 (married). Itemize if mortgage interest + state taxes + charitable donations exceed the standard. About 90% of taxpayers use the standard deduction.