Federal Income Tax Rates

Federal Income Tax Rates

Your federal income tax rate can vary greatly, and is dependent both on your filing status and your taxable income, as well as some other variables. For example, tax rates on dividend income will be different from tax rates on capital qualified gains.

As a taxpayer, you will select your income tax amount from the 2009 Tax Table or Tax Rate Schedule provided by the IRS. If your taxable income for 2009 is over $100,000 you will use the Tax Rate Schedule to figure your income tax amount. If your taxable income is under $100,000, you will use the Tax Table. Both of these documents can be located in the back of the 1040 Instruction booklet, Publication 17.

The IRS has a variety of marginal tax rates that all taxpayers are classified into. It is this percentage that you consult the Tax Table and Tax Rate Schedule to verify. Tax brackets include the 10%, 15%, 25%, 28%, 33%, and 35% tax rates. Each bracket includes a specific dollar amount, i.e. $0-$7,550. The percentage rates indicate what percent of every additional dollar you earn (ordinary income) beyond each bracket will be taxed. For example, the 10% bracket ends at $7,550, meaning, that every dollar beyond $7,550 will be taxed 15%, until you hit the 25% bracket amount. The 35% bracket applies if you have a yearly income of over $336,550 while filing jointly or as a qualifying widow(er).

Article written by: Letty G.

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