tax bracket


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Related to tax bracket: Marginal Tax Bracket

Tax bracket

The percentage of tax obligation for a particular taxable income.

Marginal Tax Rate

A percentage of one's income that one must pay in taxes. Marginal tax rates vary according to income levels. One who makes $100,000 per year has a higher marginal tax rate than one who makes $25,000. However, the marginal tax rate does not increase for one's entire income, merely each dollar over a certain threshold. Suppose one pays 10% of one's income up to $25,000, and 20% thereafter. The taxpayer making $25,001 does not suddenly have to pay 20% of his/her entire income, only on the one dollar over $25,000. That is, he/she owes 10% of $25,000 ($2,500) and 20% of the $1 over that (or $0.20). All things being equal, this taxpayer owes $2,500.20 in taxes.

tax bracket

Tax bracket.

A tax bracket is a range of income that is taxed at a specific rate.

In the United States there are six brackets, taxed at 10%, 15%, 25%, 28%, 33%, and 35% of the amount that falls into each bracket.

For example, if your taxable income was high enough to cross three brackets, you'd pay tax at the 10% rate on income in the lowest bracket, at the 15% rate on income in the next bracket, and at the 25% rate on the rest.

The rates remain fixed until they are changed by Congress, but the dollar amounts in each bracket change slightly each year to adjust for inflation.

In addition, the income that falls into each bracket varies by filing status, so that if you file as a single taxpayer you may owe more tax on the same taxable income as a married couple filing a joint return.

tax bracket

The highest marginal tax rate to which a person or estate will be subject.Income taxes and estate taxes are calculated as a percentage of adjusted gross income, but the percentage increases as income increases. One's income is divided into brackets with an upper and lower limit to each bracket;the income within the bracket is taxed at its appropriate percentage rate,and then the next bracket is taxed at a higher percentage rate. See marginal tax rate.

Tax Bracket

The rate at which income at a particular level is taxed.
References in periodicals archive ?
Having done the exercise, in the last three meetings, we have been systematically looking at the 28 per cent tax bracket and rationalising items from it to the lesser category," Jaitley said, while addressing the press, and added that 178 items would be brought from 28 per cent to 18 per cent from November 15.
This bodes well for the vast majority of clients for whom getting to the 0% tax bracket is a realistic goal.
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6% Tax Bracket $759 $3,461 $3,724 35% Tax Bracket $870 $3,635 $4,340 33% Tax Bracket $(792) $118 $2,883 28% Tax Bracket $(672) $(672) $(672) 25% Tax Bracket $(600) $(600) $(600) Itemized Deductions of $8,000 2 4 6 Exemptions Exemptions Exemptions 39.
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Getting to the zero percent tax bracket involves accumulating precisely the right amounts of dollars in each of the three basic types of accounts or buckets: taxable, tax-deferred and tax-free.
The second tier tax bracket, previously for those earning between EGP 5,000 and EGP 20,000, will now include those earning up to EGP 30,000, who will now pay 10% instead of the previous 15%.
Ian Bartholomew, senior mortgage manager at First Direct, says: Offset mortgages used to be seen as complicated and, when they were launched in the 1990s, only 5% of Britons found themselves in the higher rate income tax bracket and able to benefit from the tax efficiency an offset mortgage offers.
The higher your tax bracket and tax rate, the more tax-advantageous it is for you to make voluntary contributions.
2-litre five-door diesel 129 horsepower models drops them into the 19% BIK tax bracket (previously 20%).