How to Find Out What Tax Bracket You Are In

Knowing what tax bracket your income falls in is very important. This is because the tax brackets tell you the amount of taxes that you owe.  Today we are discussing how to find out what tax bracket you are in.

Marginal Income Tax Brackets

This represents the highest tax rate that has to be paid on your income. Currently, the brackets are 10, 15,25,28,33 and 35%. The more you earn, the more you will pay. However, your taxable income ultimately determines which tax bracket you fall into. Furthermore, keep in mind your tax bracket can change each year. For instance, if you make more money in 2014 than you made in 2013 yet in 2015, you make less again, you will be in different tax brackets each year. The IRS created this system back in the 1900s so lower income taxpayers would pay less money. Additionally, when you add in tax credits and deductions usually federal income tax owed is decreased significantly.

If you found this article helpful, be sure to read the article on our main blog, “Things You Need to Know About Filing Taxes in 2014.”

 

Determining Your Tax Bracket

You have to make sure that your taxable income is correct. To do this you have to consider your filing status, your standard deduction amount, and the deductions that you take. Many people have trouble deciding on their filing status so it is important to make sure that you do not go with the one that gives you the most tax benefits but the one that actually fits your current situation.

Closing Thoughts

If you want to be in a low tax bracket, the goal is to make sure that your taxable income is as low as possible.

 

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