Your marginal tax rate is the percentage you pay on your last dollar of income
Your marginal tax rate is the tax rate applied to your highest bracket of income — the money you earn above a certain threshold. It is not the same as your overall tax rate. If you earn $60,000 and fall into the 22% bracket, that does not mean you pay 22% on all $60,000. It means you pay 22% only on income above the threshold for that bracket, and lower percentages on the income below it.
The IRS publishes tax brackets every year, and they change based on inflation. Your job is to find which bracket your total income falls into, then read across to find your marginal rate. This matters because it tells you how much tax you will owe on any additional income — whether from a raise, a side job, or investment gains.
Key Takeaways
- Tax brackets are published by the IRS each year and vary by filing status (single, married filing jointly, head of household, or married filing separately).
- To find your marginal rate, add up your total taxable income, then match it to the correct bracket for your filing status.
- Your marginal rate applies only to income above the threshold for that bracket, not to all your income.
- The IRS website (irs.gov) publishes current-year brackets in January or February; tax software and tax preparation sites also display them.
- Knowing your marginal rate helps you understand how much tax a raise, bonus, or investment gain will actually cost you.
How to locate the current tax brackets
The IRS publishes tax brackets on irs.gov under "Tax Brackets and Rates." Search for the current year — for example, "2024 tax brackets" — and you will find a page with four tables, one for each filing status. The brackets are also listed in IRS Publication 505, which is free to read.
Tax software (TurboTax, H&R Block, TaxAct) displays brackets automatically when you enter your income. If you use a tax preparer, they have the brackets in their system. You can also find them on tax news sites like TaxFoundation.org or on your state tax authority's website if you need your state marginal rate.
Finding your filing status and total taxable income
Before you can match yourself to a bracket, you need two pieces of information: your filing status and your total taxable income for the year.
Your filing status is one of four categories: Single, Married Filing Jointly, Married Filing Separately, or Head of Household. You choose this when you file your tax return. If you are unsure which applies to you, the IRS website has a tool called "What is My Filing Status?" that walks you through the rules.
Your taxable income is not the same as your gross income. It is your gross income minus deductions. If you take the standard deduction (most people do), subtract that amount from your gross income. If you itemize deductions, subtract the total of those instead. The result is your taxable income. You can find your standard deduction amount on irs.gov by searching "standard deduction" and your filing status.
Reading the tax bracket table to find your rate
Once you have your taxable income and filing status, find the correct table on the IRS page. Each table shows income ranges and the corresponding tax rate. For example, a 2024 single filer table might show:
| If taxable income is over | But not over | Tax rate |
| $11,600 | $47,150 | 12% |
| $47,150 | $100,525 | 22% |
| $100,525 | $191,950 | 24% |
If your taxable income is $75,000, you find the row where $75,000 falls between the "over" and "but not over" amounts. In this example, $75,000 is over $47,150 but not over $100,525, so your marginal tax rate is 22%.
Remember: this 22% applies only to income above $47,150. The income from $0 to $11,600 is taxed at 10%, and income from $11,600 to $47,150 is taxed at 12%. Your overall tax rate (total tax divided by total income) will be lower than your marginal rate.
Why your marginal rate matters for financial decisions
Knowing your marginal rate helps you do quick math on decisions that affect your income. If your marginal rate is 22% and you are offered a $5,000 raise, you will owe roughly $1,100 in federal income tax on that raise (before state tax and payroll taxes). If you are considering selling an investment that would push you into a higher bracket, your marginal rate tells you the cost.
It also matters for deductions. A $1,000 deduction saves you money equal to your marginal rate times $1,000. At a 22% marginal rate, a $1,000 deduction saves you $220 in federal tax. At a 12% marginal rate, it saves you $120. This is why high-income earners benefit more from the same deduction than lower-income earners do.
The difference between marginal and effective tax rate
Your effective tax rate is your total federal income tax divided by your total taxable income. It is always lower than your marginal rate because the tax system is progressive — you pay lower rates on the first dollars you earn and higher rates on the last dollars.
If you owe $12,000 in federal income tax on $75,000 of taxable income, your effective rate is 16% ($12,000 ÷ $75,000). Your marginal rate might be 22%, but you do not pay 22% on all $75,000. Tax software calculates your effective rate automatically when you file.
Tax brackets for different filing statuses
The same income amount puts you in different brackets depending on your filing status. A single filer with $60,000 of taxable income is in a different bracket than a married couple filing jointly with $60,000 combined. Married filing jointly brackets are wider (higher income thresholds), which is why couples often have a lower marginal rate on the same total income.
If you are married and considering filing separately, check both scenarios — your combined marginal rate as a joint filer versus your individual rates if you file separately. The IRS brackets make it clear which is better for your situation, though filing separately usually costs more in tax.
Frequently Asked Questions
Does my marginal tax rate change if I get a raise?
Yes, if the raise pushes your total income into a higher bracket. A $10,000 raise might keep you in the same bracket, or it might move you into the next one. Either way, only the income above the bracket threshold is taxed at the new rate. You do not pay the higher rate on your entire income.
Where do I find tax brackets for my state?
Each state tax authority publishes its own brackets on its website. Search "[your state] tax brackets" or visit your state's department of revenue or taxation website. Some states have no income tax, so you would only have a federal marginal rate.
Do self-employed people use the same tax brackets?
Yes, the same federal brackets explore. However, self-employed people also owe self-employment tax (Social Security and Medicare), which is calculated separately. Your marginal rate for income tax purposes is the same, but your total tax burden is higher because of self-employment tax.
Can my marginal tax rate go down if I earn less?
Yes. If your income drops below a bracket threshold, your marginal rate becomes the rate for the lower bracket. This can happen if you retire, take a year off, or have a year with lower business income.
What if I have investment income — does it use the same brackets?
Most investment income (capital gains and dividends) uses different brackets than ordinary income, and the rates are usually lower. Long-term capital gains have their own bracket structure. Your tax software or preparer will calculate this separately and add it to your ordinary income to find your overall marginal rate.