Marginal Tax Rate Calculator (Tax Year 2016)
Use this calculator to determine your marginal and effective tax rates for tax year 2016. This calculator sorts through the tax brackets and filing options to calculate your true tax liability.
How the marginal tax rate calculator (tax year 2016) works
Using the 2016 brackets, it computes your total federal tax and your effective (average) rate, and identifies the bracket your last dollar falls into — your marginal rate, which applies to additional income.
Worked example: with taxable income of $80,000, the marginal tax rate calculator (tax year 2016) shows marginal tax rate of 25%.
- Total federal tax
- $15,771
- Marginal rate
- 25%
- Effective rate
- 19.7%
- Tax on next $1,000
- $250
The formula
Marginal rate = the 2016 bracket containing your taxable income; effective rate = total 2016 tax ÷ taxable income.
Results are estimates for educational purposes and are not financial advice. Confirm exact figures with your lender, plan administrator or advisor.
Questions about the marginal tax rate calculator (tax year 2016)
What is the difference between marginal and effective rate?
Your marginal rate is the tax on your next dollar of income; your effective rate is your total tax divided by your income. The effective rate is always lower.
Why does the marginal rate matter?
It tells you the tax cost of earning more — or the savings from a deduction or pre-tax contribution. A deduction saves you tax at your marginal rate.
What were the 2016 brackets?
Seven rates from 10% to 39.6%, with the thresholds depending on filing status. The calculator applies the correct 2016 schedule for single or joint filers.
Is the Marginal Tax Rate Calculator (Tax Year 2016) free to use?
Yes. Every calculator on FinCalculators is completely free, with no sign-up, login or paywall. You can run as many scenarios as you like.