Tax calculators

Which tax calculator do you need?

The right calculator depends on your tax situation. Employees checking their paycheck or planning a salary negotiation should start with the Take-Home Pay Calculator — it converts gross salary to net after federal income tax, Social Security, and Medicare. Self-employed individuals and freelancers need the Self-Employment Tax Calculator and the Quarterly Tax Calculator — the IRS requires quarterly estimated tax payments if you expect to owe more than $1,000.

Investors selling assets should run the Capital Gains Tax Calculator before selling — the difference between short-term (ordinary income rates) and long-term (0%, 15%, or 20%) capital gains can be significant. Business owners running payroll should use the Payroll Tax Calculator. For 1099 contractors and gig workers, the 1099 Tax Calculator estimates what you will owe including the self-employment tax that employees never see.

How the US federal income tax system works

Progressive marginal tax brackets

The US uses a progressive tax system, meaning each portion of your income is taxed at a different rate as it crosses bracket thresholds — not your entire income at the top rate. For 2025, federal brackets for single filers are 10%, 12%, 22%, 24%, 32%, 35%, and 37%. A single filer earning $100,000 pays 10% on the first $11,925, 12% on income from $11,925–$48,475, 22% on income from $48,475–$103,350, and so on. Their effective rate is well below 22%.

Marginal rate vs. effective rate

Your marginal rate is the rate on your last dollar of income — what most people mean when they say “I'm in the 22% bracket.” Your effective rate is total tax paid divided by total taxable income — always lower than your marginal rate because of how brackets work. The Income Tax Calculator shows both. For 2025 federal brackets, refer to the IRS official announcement.

Self-employment tax

Self-employed individuals pay 15.3% self-employment tax on net earnings up to $176,100 (2025 Social Security wage base), then 2.9% Medicare on income above that threshold. This covers both the employee and employer portions of Social Security and Medicare. You can deduct half of self-employment tax from your gross income when calculating income tax. Many freelancers underestimate this — your total tax burden as a self-employed person is frequently 5–10 percentage points higher than as an equivalent employee.

Capital gains tax rates (2025)

Assets held under 12 months are taxed as ordinary income (up to 37%). Assets held over 12 months qualify for long-term capital gains rates: 0% for income up to $47,025 (single filers), 15% up to $518,900, and 20% above that. High earners also pay an additional 3.8% Net Investment Income Tax (NIIT). Timing the sale of an investment to qualify for long-term rates can save thousands. For official 2025 figures, see IRS Topic No. 409.

Common tax mistakes small business owners make

• Not making quarterly estimated tax payments. If you expect to owe more than $1,000 in federal taxes, the IRS requires quarterly payments (due April, June, September, January). Missing these triggers underpayment penalties even if you pay in full at year-end.
• Forgetting self-employment tax when pricing services. If you price a freelance project to clear $100/hour after income tax, you also need to cover 15.3% self-employment tax. Many freelancers underprice by not accounting for this.
• Not tracking deductible business expenses. Home office, vehicle use, software subscriptions, health insurance premiums, and retirement contributions are all potentially deductible for self-employed individuals. Missed deductions mean overpaying.
• Selling appreciated assets without checking capital gains impact. Selling stock or property that has grown significantly can push you into a higher bracket or trigger NIIT. Run the capital gains calculator before executing any sale.

Frequently asked questions