TaxWrenKey takeaways
- Your marginal rate is the rate on your next dollar of taxable income. In 2026 the federal brackets run from 10% to 37%.
- Your effective rate is your total tax divided by your income. A single filer earning $75,000 is in the 22% bracket but pays 10.2% of wages in federal income tax.
- Moving into a higher bracket only raises the rate on the income above the threshold, so the brackets alone never make a raise leave you with less.
On this page
Your marginal tax rate is the rate on your next dollar of taxable income, the bracket you are in. Your effective tax rate is your total tax divided by your income. A single filer earning $75,000 in 2026 is in the 22% bracket, yet pays $7,670 in federal income tax, an effective rate of 10.2% of wages. The gap comes from the standard deduction and from the lower brackets that every dollar passes through first.
What is a marginal tax rate?
Federal income tax uses brackets. Each rate applies only to the slice of taxable income that falls inside its bracket, so a higher bracket never raises the tax on the income below it. Your marginal rate is the rate of the highest slice you reach. Here is how the $75,000 salary fills the 2026 single brackets, after the $16,100 standard deduction leaves $58,900 of taxable income:
| Rate | Bracket | Income in bracket | Tax |
|---|---|---|---|
| 10% | $0 to $12,400 | $12,400 | $1,240 |
| 12% | $12,400 to $50,400 | $38,000 | $4,560 |
| 22% | $50,400 to $105,700 | $8,500 | $1,870 |
| Total | $58,900 | $7,670 |
Source: IRS Rev. Proc. 2025-32. Wages only, standard deduction.
Only $8,500 is taxed at 22%. The full table for every filing status is on the federal tax brackets page.
What is an effective tax rate?
It is the share of your income that goes to tax: total tax ÷ income. Dividing by gross income (wages here) shows what share of everything you earned went to federal income tax. Dividing by taxable income gives a higher figure, because the standard deduction is already left out. For single filers in 2026:
| Wages | Taxable income | Federal income tax | Marginal rate | Effective (wages) | Effective (taxable) |
|---|---|---|---|---|---|
| $40,000 | $23,900 | $2,620 | 12% | 6.6% | 11% |
| $75,000 | $58,900 | $7,670 | 22% | 10.2% | 13% |
| $120,000 | $103,900 | $17,570 | 22% | 14.6% | 16.9% |
| $250,000 | $233,900 | $51,304 | 32% | 20.5% | 21.9% |
| $700,000 | $683,900 | $209,000 | 37% | 29.9% | 30.6% |
TaxWren estimate: federal income tax only, no credits, no FICA or state tax.
The effective rate rises with income but stays well below the marginal rate at every level shown. The income tax calculator gives both rates for your own income, filing status and children.
Will a raise push me into a higher tax bracket?
It can move you into a higher bracket, but only the part of the raise above the threshold pays the higher rate. Everything below it is taxed exactly as before.
Why can your real marginal rate be higher than your bracket?
The bracket is only the income tax part. Other rules also take a share of the next dollar you earn:
- On wages below the Social Security wage base, each extra dollar also pays 7.65% in FICA. In the 22% bracket, that makes 29.65% before any state tax.
- Some credits shrink as income rises. A married couple with two children and $450,000 of wages is in the 32% bracket, but $1,000 more wages raises their income tax by $370, because the child tax credit phase-out takes $50 of the credit for each $1,000. Their marginal income tax rate is 37% until the credit is gone.
- If your state has an income tax, its own marginal rate comes on top.
Sources
- IRS: Federal income tax rates and brackets (official)
- IRS: IRS Rev. Proc. 2025-32 (2026 tax brackets and standard deduction) (official)
- IRS: Topic no. 751, Social Security and Medicare withholding rates (official)
Figures come from the data files behind our calculators and update with them. See our methodology and editorial policy. This article is general information, not tax advice.
Frequently asked questions
What is the marginal tax rate on $100,000?
For a single filer with $100,000 of wages in 2026, taxable income after the $16,100 standard deduction is $83,900, which falls in the 22% bracket. Federal income tax is about $13,170, an effective rate of 13.2%.
Should I use the marginal or the effective rate?
Use the marginal rate to estimate what changes at the edge: tax on a raise, a bonus, or the saving from a deduction or a pre-tax 401(k) contribution. Use the effective rate to compare your overall tax with other people, other years or other states.
Is the effective tax rate based on gross income or taxable income?
Either, as long as you say which. Dividing by gross income shows the share of everything you earned; dividing by taxable income gives a higher number because the standard deduction is left out. This article uses wages (gross income) unless it says otherwise.
Does the effective rate include state tax and FICA?
Not in the tables here, which cover federal income tax only. Social Security and Medicare add 7.65% of wages for most employees, and state income tax adds more where your state has one. The take-home pay calculator shows all of them together.
Run your own numbers
- Income tax calculator
Federal and state income tax owed for 2026.
- Federal tax brackets by year
Current and previous federal tax brackets, standard deduction and key figures, with year-over-year changes.
- Take-home pay calculator
Gross to net salary after federal, FICA, state and local taxes.
- Tax bracket calculator
Your 2026 federal tax bracket from gross or taxable income: marginal and effective rate, the tax from each bracket, the income left before the next bracket and your state marginal rate.