Marginal vs Effective Tax Rate Calculator

How it works

Taxable = gross − deductions · Marginal rate = rate on the last taxable dollar · Effective rate = total tax ÷ gross income

Your marginal rate is the bracket your last dollar lands in — it decides the tax on a raise, a bonus or a Roth conversion. Your effective rate is total tax divided by income, always lower because the early dollars are taxed at 10% and 12% before higher rates apply, and because deductions carve income out entirely. Confusing the two leads people to overestimate their tax bill and to fear crossing a bracket that only touches their top dollars.

Worked example

A single filer earns $100,000 and takes the $14,600 standard deduction, leaving $85,400 taxable. That sits in the 22% bracket (marginal), but the tax is about $13,841 — only 13.8% of the $100,000 gross. The effective rate is well under the marginal rate because lower brackets and the deduction pull the average down.

Frequently asked questions