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Marginal Tax Rate Calculation:
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The marginal tax rate (MTR) is the tax rate applied to your next dollar of income. It represents the percentage of tax you would pay on an additional dollar of earnings, based on the progressive tax bracket system.
The calculator uses the 2022 US federal tax brackets:
The calculator determines which tax bracket your income falls into based on your filing status and returns the corresponding marginal tax rate percentage.
Details: Understanding your marginal tax rate is crucial for financial planning, investment decisions, and evaluating the tax implications of additional income or deductions.
Tips: Enter your taxable income in USD and select your filing status. The calculator will determine your marginal tax rate based on 2022 federal tax brackets.
Q1: What's the difference between marginal and effective tax rate?
A: Marginal tax rate is the rate on your next dollar of income, while effective tax rate is your total tax divided by total income.
Q2: Do state taxes affect marginal tax rate?
A: Yes, state income taxes should be considered for a complete picture of your marginal tax rate.
Q3: How often do tax brackets change?
A: Tax brackets are typically adjusted annually for inflation, but major changes require legislative action.
Q4: Are capital gains taxed at marginal rates?
A: Long-term capital gains have separate tax rates that are generally lower than ordinary income tax rates.
Q5: How does marriage affect marginal tax rates?
A: Married couples can choose between filing jointly or separately, which can significantly impact their marginal tax rates.