Devin
New Member

After you file

"Effective tax rate" is not something that will appear on your tax return, and there's actually not a single definition of what it is. Essentially, effective tax rate is just the average tax rate you pay on all of your income.

There's multiple ways you can calculate this number, depending on which effective tax rate you're interested in. If you want to know your effective tax rate on only your "taxable income" (i.e. your income after all adjustments, deductions, and exemptions), then just divide your total tax (Line 61 of Form 1040) by your taxable income (Line 43 of Form 1040). If you're interested in the effective tax rate on all of your income (even the income you don't pay any tax on because of deductions, etc.), then divide your total tax by your total income (Line 22 of Form 1040).

You can also choose different lines for income (maybe you want Adjusted Gross Income on line 37, or maybe you want to add in even non-taxable income from tax exempt interest or social security benefits) and different lines for the tax (maybe you don't want to include penalties or self-employment tax from the "Other Taxes" section). But basically it's just your taxes paid -- under whatever definition of taxes paid you want to use -- divided by your income -- under whatever definition of income you want to use.

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