How Tax Brackets Work in 2026 (With a Worked Example)
A raise never makes you poorer — but many people believe it can, because brackets are misunderstood. Here is how the marginal system actually works, with the official 2026 table and real numbers.
How Tax Brackets Actually Work
The most common tax myth in America is that moving into a higher bracket taxes all your income at the higher rate. It does not. The US federal system is marginal: your taxable income is sliced into layers, and each layer is taxed at its own rate. Only the dollars inside a bracket are taxed at that bracket's rate.
Step 1: find your taxable income
Brackets apply to taxable income, not your salary. For 2026, subtract the standard deduction first: $16,100 (single), $32,200 (married filing jointly) or $24,150 (head of household). Pre-tax 401(k) contributions reduce it further.
Step 2: walk the 2026 single-filer table
| Taxable income over | Up to | Rate |
|---|---|---|
| $0 | $12,400 | 10% |
| $12,400 | $50,400 | 12% |
| $50,400 | $105,700 | 22% |
| $105,700 | $201,775 | 24% |
| $201,775 | $256,225 | 32% |
| $256,225 | $640,600 | 35% |
| $640,600 | — | 37% |
Note: the 24% bracket starts at $105,700 of taxable income. Full official tables for every filing status are in our Tax Bracket Calculator.
Worked example: $85,000 salary, single filer
- Taxable income: $85,000 − $16,100 = $68,900
- 10% on the first $12,400 = $1,240
- 12% on the next $38,000 = $4,560
- 22% on the remaining $18,500 = $4,070
- Total federal income tax: $9,870 — a marginal rate of 22%, but an effective rate of just 11.6% of gross pay
That gap between your marginal rate (the bracket your last dollar falls in) and your effective rate (tax ÷ total income) is the single most useful idea in US personal tax. Raises are always worth taking: only the dollars above a threshold are taxed at the higher rate.
Where to find official tax tables online
The IRS publishes the official schedules in Revenue Procedure 2025-32 for 2026. Our Federal Tax Brackets Calculator turns those tables into an instant answer for your income and filing status, and the Income Tax Calculator gives your full federal tax, effective rate and take-home pay.
Frequently Asked Questions
Do tax brackets apply to my whole income?
No. Brackets are marginal: each slice of taxable income is taxed at its own rate. On $68,900 of taxable income (single, 2026), the tax is $9,870 — not 22% of the whole amount.
What are the federal tax brackets for 2026?
For single filers: 10% up to $12,400 of taxable income, 12% to $50,400, 22% to $105,700, 24% to $201,775, 32% to $256,225, 35% to $640,600 and 37% above that. Standard deductions are $16,100 single and $32,200 married filing jointly.
What is the difference between marginal and effective tax rate?
Your marginal rate is the bracket your last dollar of taxable income falls into. Your effective rate is your total tax divided by your total income — it is always lower, because lower slices are taxed at lower rates and deductions come first.