The marginal tax rate is the highest tax bracket by which your income will be taxed.
- For instance, if you're a single person whose taxable income was $50,000 in 2020, then you fall into the 22% tax bracket. Therefore, your marginal tax rate is 22%.
Your “effective tax rate” is the average percentage of your taxable income that you owe in federal taxes. In order to calculate this rate, you simply divide your tax liability (what you owe) by your total taxable income.
Here is a TurboTax article about effective and marginal tax rates.
