2026 Federal Income Tax Calculator: Post-OBBBA Model
Calculate your 2026 federal income tax liability. Includes 2026 brackets, new senior deductions, FICA taxes, and tax refund estimation.
Understanding 2026 Federal Income Tax Brackets
Progressive Tax System
- 2026 Brackets (Single):10% on first $12,400; 12% from $12,401-$50,400; 22% from $50,401-$100,525; 24% from $100,526-$191,950; 32% from $191,951-$243,725; 35% from $243,726-$609,350; 37% above $609,350
- 2026 Brackets (Married):10% on first $24,800; 12% from $24,801-$100,800; 22% from $100,801-$201,050; 24% from $201,051-$383,900; 32% from $383,901-$487,450; 35% from $487,451-$731,200; 37% above $731,200
- Marginal Rate:The tax rate on your last dollar earned (your highest bracket)
- Effective Rate:The average tax rate across all your income (always lower than marginal rate)
The U.S. uses a progressive tax system where different portions of your income are taxed at different rates. Your income is divided into brackets, with each bracket taxed at its specific rate.
Only income in the highest bracket is taxed at the marginal rate. Income in lower brackets is taxed at lower rates.
Standard Deduction and Taxable Income
- 2026 Standard Deduction:Single: $16,100 | Married Filing Jointly: $32,200 | Head of Household: $24,100
- Taxable Income:Gross Income - Standard/Itemized Deduction - Pre-Tax Contributions - Senior Deduction
- When to Itemize:Itemize only if your itemized deductions (mortgage interest, state taxes, charitable contributions) exceed the standard deduction
- Standard Deduction Savings:The standard deduction can save thousands in taxes, depending on your marginal tax bracket
The standard deduction reduces your taxable income before calculating taxes. For 2026, the standard deduction is significantly higher than previous years.
The Senior Deduction and FICA Taxes
The $6,000 Senior Deduction
- Qualification:Available to taxpayers age 65 and older
- Phase-Out Thresholds:Single: $75,000 | Married Filing Jointly: $150,000 | Head of Household: $75,000
- Phase-Out Rate:Reduces by $1 for every $25 of income above the threshold
- Complete Phase-Out:Single: $100,000 | Married: $175,000
- Tax Savings:Can save up to $2,220 in taxes for seniors in the 37% bracket
Taxpayers age 65 and older qualify for an additional $6,000 deduction beyond the standard deduction, but it phases out at higher income levels.
The senior deduction is in addition to the standard deduction, providing significant tax savings for eligible taxpayers.
FICA Taxes: Social Security and Medicare
- Social Security Tax:6.2% on income up to $176,200 (2026 wage base). Income above this amount is not subject to Social Security tax.
- Medicare Tax:1.45% on all income, with no wage base limit
- Additional Medicare Tax:0.9% on income above $200,000 (single) or $250,000 (married). This applies only to the excess income.
- Total FICA:Combined rate of 7.65% for most taxpayers, up to 8.55% for high earners subject to Additional Medicare Tax
FICA taxes fund Social Security and Medicare programs. Unlike income taxes, FICA taxes are not reduced by deductions and have specific wage bases.
Tax Optimization Strategies for 2026
Pre-Tax Contributions and Tax Deferral
- 401(k) Contributions:2026 limit: $23,000 ($30,500 if 50+). Reduces taxable income and saves taxes at your marginal rate.
- HSA Contributions:2026 limit: $4,400 individual ($8,800 family). Triple tax advantage: pre-tax contributions, tax-free growth, tax-free withdrawals for medical expenses.
- Tax Savings Example:A $5,000 401(k) contribution in the 22% bracket saves $1,100 in federal taxes, plus state tax savings.
- Long-Term Benefit:Pre-tax contributions grow tax-deferred, potentially saving tens of thousands in taxes over decades.
Contributing to pre-tax retirement accounts (401(k), 403(b)) and HSAs reduces your taxable income dollar-for-dollar, providing immediate tax savings.
Maximizing pre-tax contributions is one of the most effective tax strategies, especially for high earners.
Understanding Marginal vs. Effective Tax Rates
- Marginal Rate Impact:Only applies to additional income in the highest bracket. A raise that pushes you into a higher bracket only affects the new income, not your existing income.
- Effective Rate Reality:Your actual average tax rate is always lower than your marginal rate because lower portions of income are taxed at lower rates.
- Tax Planning:Understanding your marginal rate helps you evaluate the tax impact of additional income, deductions, or retirement contributions.
- Bracket Management:Strategically timing income and deductions can help you stay in lower brackets or maximize deductions in higher brackets.
The distinction between marginal and effective tax rates is crucial for tax planning and financial decision-making.
Income Tax Calculator FAQ
? What is the difference between Marginal and Effective Tax Rate?
Your Marginal Tax Rate is the tax rate applied to your last dollar of income (your highest tax bracket). Your Effective Tax Rate is the average tax rate across all your income. For example, if you're in the 24% marginal bracket, only income above that bracket threshold is taxed at 24%. Income in lower brackets is taxed at 10%, 12%, and 22%. This is why your effective rate is always lower than your marginal rate.
? What is the 2026 Standard Deduction?
The 2026 standard deduction is $16,100 for Single filers, $32,200 for Married Filing Jointly, and $24,100 for Head of Household. This is the amount you can deduct from your income before calculating taxes, without needing to itemize deductions. Most taxpayers benefit from taking the standard deduction rather than itemizing.
? What is the Senior Deduction and who qualifies?
The $6,000 Senior Deduction is a bonus deduction available to taxpayers age 65 and older. It phases out for single filers with income above $75,000 and married couples with income above $150,000. The deduction reduces by $1 for every $25 of income above the threshold, completely phasing out at $100,000 (single) or $175,000 (married). This is in addition to the standard deduction.
? How are FICA taxes calculated?
FICA (Federal Insurance Contributions Act) taxes fund Social Security and Medicare. Social Security tax is 6.2% on income up to $176,200 (2026 wage base). Medicare tax is 1.45% on all income, plus an additional 0.9% on income above $200,000 (single) or $250,000 (married). Unlike income tax, FICA taxes are not reduced by deductions.
? How do pre-tax contributions reduce my tax liability?
Pre-tax contributions to 401(k), 403(b), or HSA accounts reduce your taxable income dollar-for-dollar. For example, if you contribute $5,000 to a 401(k) and you're in the 22% tax bracket, you save $1,100 in federal taxes (plus state taxes). This is why maxing out pre-tax contributions is one of the most effective tax strategies.
? Should I take the Standard Deduction or Itemize?
Take the Standard Deduction unless your itemized deductions (mortgage interest, state/local taxes, charitable contributions, medical expenses) exceed the standard deduction amount. For 2026, most taxpayers benefit from the standard deduction unless they have significant mortgage interest, high state taxes, or large charitable contributions.