How tax brackets work
Being “in the 22% bracket” does not mean 22% of your pay goes to federal income tax. Drag the slider and watch why.
Pour your income into the buckets
Each bracket is a bucket with a fixed size. Income fills the 10% bucket first, then spills into 12%, then 22%. Only the dollars inside a bucket pay that bucket’s rate.
Minus the $16,100 standard deduction leaves $73,900 taxable.
Real tax: $10,970 · effective 12.2% of salary, though you are “in the 22% bracket”.
The short version
The United States taxes income progressively: the rate climbs only for the dollars that cross each threshold. A single filer earning $90,000 in 2026 has $73,900 of taxable income after the $16,100 standard deduction. The first $12,400 is taxed at 10%, the next $38,000 at 12%, and the last $23,500 at 22%. The total is $10,970, an effective rate of about 12% of salary, even though the top bracket is 22%.
Marginal vs. effective rate
Your marginal rate is what the next dollar you earn will be taxed at. It is the number that matters for decisions like “is it worth putting another $1,000 in my 401(k)?” (you save $220 at 22%). Your effective rate is your total tax divided by income, the number to compare with other people or other years.
The myth, and why it persists
People hear “I’ll jump into a higher bracket” and imagine their whole income being re-taxed. Flip the toggle in the explainer to see what that would cost; the gap is often thousands of dollars. The real system never punishes a raise through the brackets alone.
Watching the buckets fill tends to make the idea stick. The US tax bracket explainer on ahaboo goes one step further and narrates each slice of a paycheck as it drops into place.
Ready to try your own numbers? The tax bracket calculator splits your income across every bracket, and the 2026 tables list every threshold.
Questions people ask
How are tax brackets calculated?
Subtract your deductions from income to get taxable income. Then tax the first slice (up to $12,400 for a single filer in 2026) at 10%, the next slice up to $50,400 at 12%, and so on. Add the slices together. Your bracket is simply the rate on the last slice.
Will a raise put me in a higher bracket and lower my pay?
No. Moving into a higher bracket only changes the rate on the dollars above the threshold. Every dollar below it is taxed exactly as before, so a raise always increases take-home pay under the federal brackets. (Some benefits and credits phase out with income, which is a different effect.)
Do capital gains use the same brackets?
No. Long-term gains and qualified dividends have their own 0%, 15% and 20% rates, and they are stacked on top of your ordinary taxable income to decide which rate applies.
Why do the brackets change each year?
The IRS adjusts the bracket thresholds for inflation every year using the chained CPI, so that inflation alone does not push people into higher brackets. The 2026 thresholds rose by roughly 2.3% to 4% from 2025.