Tax Brackets (Marginal Tax Rate)
Rates applied in slices, where each rate touches only the income falling inside its own band.
US federal income tax is applied in slices. The first band is taxed at 10%, the next at 12%, and so on to 37%, with each rate applying only to the income inside its own range.
The common misreading is that crossing into a higher bracket raises the rate on all income. It does not. Moving $1 past a threshold taxes that $1 at the higher rate and leaves every dollar below it exactly as taxed as before, so additional gross income always increases take-home pay. Benefit cliffs and phase-outs can create genuine local reversals, but the bracket structure itself never does.
Marginal rate is the rate on the next dollar earned. Effective rate is total tax divided by total income. The marginal rate is the one relevant to a decision about additional income or a deduction, and the effective rate describes the year as a whole. The second is always the lower of the two.
Worked through
Federal brackets, single filer, 2025
| Income Range | Rate |
|---|---|
| $0–$11,925 | 10% |
| $11,926–$48,475 | 12% |
| $48,476–$103,350 | 22% |
| $103,351–$197,300 | 24% |
| $197,301–$250,525 | 32% |
| $250,526–$609,350 | 35% |
| $609,351+ | 37% |
See your own tax brackets (marginal tax rate)
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