Effective Tax Rate Calculator
Formula
Effective Rate = Tax Paid ÷ Income × 100
Your effective tax rate is the actual percentage of your income that goes to taxes. It's lower than your marginal tax bracket because only income above each threshold is taxed at the higher rate.
Frequently Asked Questions
What is effective vs marginal tax rate?
Marginal rate is the rate on your last dollar earned. Effective rate is total tax ÷ total income — it's always lower.