How US Income Tax Works
The US uses a progressive income tax system — you pay a higher rate only on income above each bracket threshold, not on your entire income. This is a common misconception: moving into a higher bracket does NOT mean all your income is taxed at that rate.
2024 Federal Tax Brackets (Single)
| Income Range | Tax Rate |
|---|
| $0 – $11,600 | 10% |
| $11,601 – $47,150 | 12% |
| $47,151 – $100,525 | 22% |
| $100,526 – $191,950 | 24% |
| $191,951 – $243,725 | 32% |
| $243,726 – $609,350 | 35% |
| Over $609,350 | 37% |
FICA Taxes (Social Security & Medicare)
All employees pay 6.2% for Social Security (on the first $168,600 of wages) and 1.45% for Medicare on all wages. Your employer matches these amounts. High earners pay an additional 0.9% Medicare surtax on wages over $200,000.
Gross vs Net Salary
Gross salary is your total pay before deductions. Net salary (take-home pay) is after all taxes and deductions. For most middle-income earners, take-home pay is roughly 70–80% of gross salary.
FAQs
How much federal tax is withheld from my paycheck?
Federal withholding depends on your salary, filing status, and W-4 elections. This calculator uses actual 2024 tax brackets to estimate your federal tax. Your actual withholding may differ slightly based on W-4 allowances.
What is the standard deduction for 2024?
The 2024 standard deduction is $14,600 for single filers, $29,200 for married filing jointly, and $21,900 for head of household. This calculator applies the standard deduction automatically.
Does a 401(k) contribution reduce my taxes?
Yes — traditional 401(k) contributions are pre-tax, which reduces your taxable income and therefore your tax bill. A $5,000 contribution in the 22% bracket saves $1,100 in federal taxes.
How do I convert my annual salary to hourly?
Divide annual salary by 2,080 (52 weeks × 40 hours). A $75,000 salary equals about $36.06/hour gross. After taxes, take-home is roughly $24–28/hour depending on your state.