Sales Tax Backout Calculator
Extract the sales tax from a tax-inclusive total — get the pre-tax price and the tax amount hidden inside a receipt total.
How it works
Pre-tax price = total ÷ (1 + rate) · Tax = total − pre-tax price
To pull the tax out of a tax-included total, you divide by (1 + rate), not subtract the rate. Subtracting the percentage over-removes the tax, because the tax was charged on the smaller pre-tax price, not on the grand total. That is also why the tax's share of the total is always a little less than the headline rate — a 7.5% rate is only about 6.98% of the tax-inclusive total. This is useful for expense reports, reverse-engineering a receipt, or separating tax from a "tax included" price.
Worked example
A $107.50 total at a 7.5% sales tax rate divides to 107.50 ÷ 1.075 = $100 pre-tax, so the tax is $7.50. Subtracting 7.5% of $107.50 would wrongly give $99.44 and overstate the tax as $8.06.
Frequently asked questions
Why divide instead of subtracting the percentage?
The tax was applied to the pre-tax price, not the total. Dividing the total by (1 + rate) recovers that original price. Subtracting the rate from the total over-removes tax because it applies the rate to a larger base than was actually taxed.
Why is the tax less than the rate as a share of the total?
The rate is a percentage of the pre-tax price, but as a share of the bigger tax-inclusive total it works out smaller. A 7.5% rate is only about 6.98% of the total — the same dollars measured against a larger base.
When would I need to back out sales tax?
Common cases include expense reporting, bookkeeping from "tax included" receipts, comparing pre-tax prices across regions, and separating the taxable base for accounting or reimbursement.
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Educational estimate using approximate 2025 US federal figures — not tax advice. Brackets, deductions and thresholds are simplified and ignore credits, state rules and W-4 details; consult a tax professional or the IRS for your actual liability.