I don't quite understand your question.
- All your taxable income is added up--wages, investments, gambling prizes, taxable portion of social security benefits, and anything else. That's your gross income.
- There are some special items that reduce your gross income, that gives you adjusted gross income.
- Then you subtract your deductions. That gives you taxable income.
- Taxable income is applied to the tax tables which use the tax brackets. That give you your income tax amount.
- However, if part of your income is from capital gains, that tax is computed according to different rules. It gets added to your regular income tax.
- Then there are tax credits, which are subtracted directly from your tax owed, instead of being subtracted from your taxable income like a deduction. That gives your total income tax.
- Then you add self-employment taxes (if you are self-employed) and you add certain excise taxes and penalty taxes (such as early withdrawals from IRAs). That gives your total tax.
- Your total tax is compared to your withholding and payments and you get a refund or owe additional money.
Bottom line, all your taxable income is included when applied to the tax brackets, not just wages.
