Hi Basith,
The rule is very clear.
You must first assume the Standard Deduction or Itemized Deductions have been subtracted from your Total Income or Adjusted Gross Income.
Every dollar above that amount is taxable.
Once you know what your taxable income is (e.g. Wage $60,000 less Standard Deduction $12950 = Taxable Income $47050), the tax rate would be assessed on the following:
$0 Taxable Income up to $40400 Taxable Income would be subject to 0% Income Tax
In this example all all excess income totaling $7050 would be subject to 10%
In addition, there is an additional tax surcharge called the Net Investment Income Tax of 3.80% if any excess income are greater than:
$200,000, if Single or Head of Household
$250,000, if Married Filing Joint
$125,000, if Married Filing Separate
