Estimating Your Federal Income Tax Due

The United States, like many other countries, has a “progressive income tax” –- high-income earners pay a higher percentage of their earnings in taxes than lower-income earners do. Let’s keep things simple and assume that you file your federal return as a “single” taxpayer and that you can’t be claimed as someone else’s dependent. Section 3. 1 in The Calculus of Happiness then discusses how you’d calculate your federal tax due. That number depends on your “tax bracket,” which is set by the Internal Revenue Service (the tax collector), and on your “taxable income,” the amount of your earned income subject to tax. (The IRS allows you certain deductions and other exemptions, so your taxable income is smaller than your earned income.) Each tax bracket uses a different percentage the IRS applies to a certain taxable income range. These, and the insights gained from the federal tax due formula –- equation (3.4) in The Calculus of Happiness –- suggest several ways to lower your tax burden (see Chapter 3 in The Calculus of Happiness).

The calculator below uses the IRS’ 2024 tax brackets to calculate federal tax due based on taxable income (not earned income). Feel free to input a taxable income value and your filing status to see how much federal tax would be due on that amount in 2024, the tax bracket you'd have been in, and the effective tax rate (the tax due as a percentage of the taxable income inputted).

Limitations

The calculator above uses the IRS’ 2024 tax bracket numbers. To update the calculator for this year, see the discussion in the book (referenced above) to understand how to modify the piecewise function defined by the tax brackets to reflect this year's tax brackets.