U.S. FEDERAL TAXABLE INCOME INFO

INCOME TAX -USA - In the United States, a federal tax is imposed on taxable income. The amount of the tax due equals net taxable income multiplied by the applicable tax rate, which may increase as income increases.

The federal income tax is assessed separately for each tax year. Individuals and regular corporations are required to report their own income and gains and those recognized indirectly through partnerships, estates, and trusts. Estates and complex trusts may be required to pay tax on undistributed income. Partnerships and other flow-through entities are generally not taxed. Instead, the owners report their allocable shares of the entity's income, gain, deduction, loss and credit.

U.S. residents and citizens are taxed on their worldwide income, while nonresidents are taxed only on U.S.-source income. Certain credits may be claimed to reduce tax. Refundable credits that exceed the tax due may be refunded as an overpayment of tax. An alternative minimum tax applies to limit the benefit of otherwise allowable deductions that exceed certain thresholds.

Taxable income equals gross income less allowable deductions. Income is broadly defined. Ordinary and necessary business expenses decrease gross income to arrive at adjusted gross income. In the case of individuals, adjusted gross income is decreased by personal allowances (personal exemption) and expenses including home mortgage interest, medical expenses that exceed 8.5% of adjusted gross income, state and local taxes, allowable charitable contributions, and investment expenses. All deductions are subject to special requirements and limits.

Marginal Tax Rate[18] Single Taxable Income Married Filing Jointly or Qualified Widow(er) Taxable Income Married Filing Separately Taxable Income Head of Household Taxable Income
10% $0 – $9,275 $0 – $18,550 $0 – $9,275 $0 – $13,250
15% $9,276 – $37,650 $18,551 – $75,300 $9,276 – $37,650 $13,251 – $50,400
25% $37,651 – $91,150 $75,301 – $151,900 $37,651 – $75,950 $50,401 – $130,150
28% $91,151 – $190,150 $151,901 – $231,450 $75,951 – $115,725 $130,151 – $210,800
33% $190,151 – $413,350 $231,451 – $413,350 $115,726 – $206,675 $210,801 – $413,350
35% $413,351 – $415,050 $413,351 – $466,950 $206,676 – $233,475 $413,351 – $441,000
39.6% $415,051+ $466,951+ $233,476+ $441,001+