Last updated
Last checked 2026-11-07. Tax brackets and deduction amounts change every year — always confirm the figures for your tax year on the official pages linked below.
Put your own salary into the calculator on this page before you compare rates — the bracket you land in is only the starting point.
The marginal rate answers a forward-looking question: if you earn one more dollar, how much of it goes to federal income tax? The effective rate answers a backward-looking one: of everything you earned, what share went to federal income tax?
Both are useful, and confusing them produces two opposite errors. Use the marginal rate to judge a raise, a side job or an extra shift. Use the effective rate to judge the burden you actually carried for the year.
The IRS is explicit that the higher rate does not apply to the whole income. Its own explanation says that when income moves into a higher bracket, the higher rate applies only to the part that sits in the new bracket (IRS).
For the 2026 tax year, a single filer's taxable income is taxed in these bands (IRS, Rev. Proc. 2025-32):
| Rate | Taxable income, single filer, 2026 |
|---|---|
| 10% | First $12,400 |
| 12% | $12,400 to $50,400 |
| 22% | $50,400 to $105,700 |
| 24% | $105,700 to $201,775 |
| 32% | $201,775 to $256,225 |
| 35% | $256,225 to $640,600 |
| 37% | Above $640,600 |
Read the table as a set of shelves. A taxpayer whose taxable income is $83,900 is usually described as being "in the 22% bracket," but the 22% rate applies only to the dollars above $50,400. The dollars below that line were taxed at 10% and 12% on the way up, and nothing re-taxes them at the higher rate.
Married couples filing jointly get wider bands for 2026: 10% up to $24,800, 12% up to $100,800, 22% up to $211,400, 24% up to $403,550, 32% up to $512,450, 35% up to $768,700, and 37% above that (IRS, Rev. Proc. 2025-32). The same layering applies; only the widths change.
Brackets are applied to taxable income, not to salary. For 2026 the standard deduction is $16,100 for a single filer and $32,200 for a married couple filing jointly (IRS, Rev. Proc. 2025-32).
That step is the first reason the effective rate falls below the marginal rate. A $100,000 salary does not meet the bracket table at $100,000; it meets it at $83,900. The deduction removes $16,100 from taxation entirely, and every dollar removed is a dollar that never reaches the 22% band.
Take a single filer in the 2026 tax year with $100,000 of gross income, the standard deduction, and no other adjustments. Taxable income is $83,900.
The tax is built from the bottom up:
Now compare the labels. The marginal rate is 22%, because the last dollar of taxable income sits in the 22% band. The effective rate on gross income is $13,170 ÷ $100,000 = 13.17%. The effective rate on taxable income is $13,170 ÷ $83,900 = 15.70%.
The 22% label never applies to the whole $100,000. It applies to $33,500 of it. That is the entire explanation for the gap between 22% and 13.17%, and it is worth being able to reproduce the arithmetic, because the same shape appears at every income level.
Neither denominator is wrong; they answer different questions.
Effective rate on gross income tells you what share of your pay went to federal income tax. It is the number to use when you compare your tax burden with someone else's, or with your own burden in a different year, because it starts from the figure on your offer letter.
Effective rate on taxable income isolates the bracket system itself. It answers "how much of the income the brackets actually saw did they take?" It is higher, because the denominator has already had the deduction removed.
For the $100,000 filer the two numbers are 13.17% and 15.70%. Quoting one while describing the other is a common source of confusion in articles and in payroll conversations. Whenever you see an effective rate, check what it is a percentage of.
One more boundary: the $13,170 figure is federal income tax only. Social Security and Medicare are withheld separately and are not part of either percentage. Neither is state income tax.
When you are deciding whether to take extra work, the marginal rate is the relevant number. An additional $1,000 of taxable income is taxed at the rate of the band it lands in — 22% for the filer above, not 13.17%. The effective rate describes the year that has already happened; it does not describe the next dollar.
The reverse mistake is just as common: treating the bracket as a cliff. Moving into a higher bracket does not reduce take-home pay, because only the dollars above the threshold are taxed at the higher rate (IRS). A raise that pushes part of your income from 12% to 22% still leaves you with more after tax than you had before.
Our suggestion: when you compare two job offers, compute the tax on each salary rather than comparing the bracket labels, because the label alone cannot tell you which leaves more.
The last point is the one that breaks comparisons. A 2026 deduction combined with a 2027 bracket produces a number that is correct for neither year.
One sentence to keep: the higher bracket is very often the better offer after tax, and the only way to know by how much is to run the salary, not the label.
Put your own gross pay into the calculator on this page and compare the effective rate it shows with the 13.17% worked out above.
Updated 2026-11-08 · Sources retrieved 2026-11-07
This is a general explanation of how federal income tax brackets work, not tax advice. The examples use a single filer, the standard deduction, no dependents, no credits and no state income tax, and they cover federal income tax only. Your own result depends on your full return. For anything you will act on, check the IRS pages linked above or ask a tax professional.
We check every report against the official source and update the page. See how on our Corrections.