What's the federal tax rate in 2026? Brackets explained

The question sounds simple, but the answer confuses many people. The United States does not tax all of your income at one percentage. Instead, it splits taxable income into layers, called brackets, and taxes each layer at its own rate. The bracket you sit in is only the rate on your top layer.

The 2026 federal tax brackets at a glance

For 2026 the seven rates are 10%, 12%, 22%, 24%, 32%, 35% and 37%. The rates did not change from 2025; under Revenue Procedure 2025-32 only the thresholds moved. The seven-rate structure was also made permanent, so it no longer expires after 2025. Every figure below is taxable income, after the standard or itemised deduction.

Heads of household sit between the two columns, with the 10% band running to $17,700. Married filing separately generally uses the single thresholds, with the top rate above $384,350.

The standard deduction comes first

Before any bracket applies, the standard deduction comes off your income. For 2026 it is $16,100 for single filers and married couples filing separately, $32,200 for joint filers, and $24,150 for heads of household, per IRS release IR-2025-103.

So a single filer earning $16,100 has no taxable income at all. If you are 65 or older, or blind, add $2,050 per condition as a single filer, or $1,650 per spouse if married.

Marginal vs effective rate: the difference that matters

Your marginal rate is the rate on your last dollar of taxable income. If your taxable income ends in the 22% band, your marginal rate is 22%, and that is the rate an extra dollar of pay would be taxed at. Your effective rate is total tax divided by income, an average across every bracket, so it is always lower.

The IRS puts it plainly: when income jumps to a higher bracket, you pay the higher rate only on the part inside the new bracket. A filer in the 22% bracket still pays 10% on the first $12,400 and 12% on the next slice up to $50,400.

Worked example: a $100,000 salary, single filer

This example is illustrative and covers federal income tax only, with no credits and no deductions beyond the standard one. A single filer earns a $100,000 salary in 2026. Subtract the $16,100 standard deduction, leaving $83,900 of taxable income.

The first $12,400 is taxed at 10%, which is $1,240. The next slice, $12,400 to $50,400, is $38,000 at 12%, which is $4,560. The rest, $50,400 to $83,900, is $33,500 at 22%, which is $7,370. Total: $1,240 + $4,560 + $7,370 = $13,170.

The marginal rate is 22%, because the top slice falls in that band. The effective rate is $13,170 divided by $100,000, about 13.2%. A joint return would owe less: the deduction is $32,200 and the brackets are wider.

What counts as ordinary income

The seven brackets apply to ordinary income: wages, salaries, tips, bonuses, self-employment income, interest, short-term capital gains on assets held for a year or less, and non-Roth retirement withdrawals.

Some income follows different rules. Long-term capital gains and qualified dividends get the lower rates below, and Roth withdrawals in retirement are generally not taxed as ordinary income. A traditional 401(k) or health savings account contribution reduces income before the standard deduction.

Capital gains rates in brief

Hold an asset for more than one year and the gain is long-term, taxed at 0%, 15% or 20%. For 2026, a single filer pays 0% on taxable income up to $49,450, 15% up to $545,500, and 20% above that. For joint filers, 0% runs to $98,900 and 20% starts above $613,700.

Sell within a year and the gain is short-term, taxed as ordinary income. Higher earners may also owe a 3.8% net investment income tax when modified adjusted gross income passes $200,000 single or $250,000 joint, taking the top long-term rate to 23.8%.

Federal tax is only part of the bill

Federal income tax is not the whole tax on a payslip. Most employees also pay payroll taxes: 6.2% for Social Security on wages up to the annual wage base, and 1.45% for Medicare on all wages, plus 0.9% extra Medicare above $200,000. On $100,000, the employee share is $7,650.

State income tax is a separate layer, and it varies widely. Some states have no income tax at all, as our guide to the states with no state tax explains, while others charge flat or graduated rates. To see the layers on a real payslip, read our guide to how much tax is deducted from a paycheck in NY.

How to find your own federal tax rate

Start with your total income for the year. Our guide to what annual income means walks through what counts, including salary, bonuses and side income. Subtract the standard deduction for your filing status, or your itemised total. The band the result ends in is your marginal rate.

Then work out the tax slice by slice, as in the example above, and divide the total by your gross income for your effective rate. Your payslip shows withholding, an estimate the IRS reconciles at filing time.

This article is general information only, not financial advice.