The 24% rate is your tax bracket which is based on your Taxable Income (Line 15 of Form 1040) and Filing Status.
- The U.S. uses seven federal tax brackets, ranging from 10% to 37%
- The progressive tax system in the U.S. has lower income levels pay lower tax rates than higher incomes
- As you earn more money, your income may fall into higher tax brackets, causing different chunks of your taxable income to be taxed at different rates
- Your effective tax rate looks at the overall taxes paid on your income, providing a better sense of your federal income tax bill as a percentage of your taxable income
Your marginal tax rate is the rate of the highest tax bracket that you'll be taxed in (for you it is 24%). It is the tax you pay on each additional dollar of your income and the rate by which each dollar of deduction lowers your tax. So, an additional 2K would be an additional $480 in tax.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
