Federal Income Tax Rates:

Use the ‘Filing Status and Federal Income Tax Rates on Taxable Income’ table to assist you in estimating your federal tax rate.

Filing status

Choose your filing status. Your filing status determines the income levels for your Federal tax rates. It is also used to determine your standard deduction, personal exemptions, and many deduction or credit phaseout income ranges. The ‘Filing Status’ table summarizes the five possible filing status choices. Your marital status as of the last day of the year determines your filing status.

Are you someone's dependent?

Choose 'no' if no one can claim you or your spouse as a dependent. Choose 'yes' if someone can claim you as a dependent. Choose 'Both myself and my spouse' if you both are dependents. You are a dependent if someone supports you and can claim you as a dependent even if they do not claim you as a dependent on their tax return.

Dependents qualifying for child tax credit

Enter the number of dependent children that qualify for the child tax credit. To qualify, a child must be under age 17 at the end of the year. They must be either your child, one of your siblings or your foster child or a child of any of them (for example your grandchild). In addition, they must have lived with you for more than half of the year, not provide more than half of their own support and must be claimed as a dependent on your tax return. In 2023, for each qualifying child you can receive up to a $2,000 tax credit. While the same as the prior year, this amount is significantly lower than 2021. In 2021, the tax credit was up to a $3,600 per child under age six and up to $3,000 per child age six to 17.

Dependents qualifying for other dependent credit

Enter the number of dependent individuals that qualify for the "Other Dependent Credit". In 2023, you may be eligible for a nonrefundable credit of up to $500 per qualifying dependent. Generally, to qualify the dependent can't have already been claimed as a qualifying child, they must have lived with you for more than half of the year, not provide more than half of their own support and must be claimed as a dependent on your tax return. The income phaseout for this credit follows the same rules and limits as the child tax credit.

Wages, salaries, tips, etc.

Enter your total of all wages, salaries, tips, etc. For this entry only enter the amount for the primary taxpayer, do not include your spouse. This is normally the amount shown on your W-2 Form(s) in box 1 provided by your employer. You should also include any wages received as a household employee not reported on a W-2 (a W-2 may not have been provided if the amount was less than $2,300). It should also include any tips not reported to your employer - including allocated tips that appear on your W-2 Form(s) box 8.

Spouse wages, salaries, tips, etc.

Enter your spouse's total of all wages, salaries, tips, etc. For this entry, only enter the amount for your spouse. This is normally the amount shown on your spouse's W-2 Form(s) in box 1 provided by your spouse's employer. You should also include any wages received as a household employee not reported on a W-2 (a W-2 may not have been provided if the amount was less than $2,300). It should also include any tips not reported to your spouse's employer - including allocated tips that appear on your spouse's W-2 Form(s) box 8.

Medicare (W-2 Box 5)

Check this box if your Medicare (W-2 Box 5) wages differs from the total of wages, salaries, tips, etc. (W-2 Box 1). If you don't have access to employer provided W-2s leave this box unchecked and the tool will assume that the amounts are the same. The Medicare (W-2 Box 5) wages will differ from the total of wages, salaries, tips, etc. only if you had non-taxable income that was subject to Medicare taxes such as a 401(k) contribution - or - if you had taxable income not subject to Medicare taxes such as health insurance paid by a S-Corporation on behalf of one of its owners.

There will be no change in your taxes unless you also pay self-employment taxes or are subject to the 0.9% Medicare sur-tax for compensation, wages and tips exceeding $200,000 ($250,000 if married filing jointly, $125,000 if married filing separately).

Spouse Medicare (W-2 Box 5)

Check this box if your spouse's Medicare (W-2 Box 5) wages differs from the total of wages, salaries, tips, etc. (W-2 Box 1). If you don't have access to employer provided W-2s leave this box unchecked and the tool will assume that the amounts are the same. The Medicare (W-2 Box 5) wages will differ from the total of wages, salaries, tips, etc. only if you had non-taxable income that was subject to Medicare taxes such as a 401(k) contribution - or - if you had taxable income not subject to Medicare taxes such as health insurance paid by a S-Corporation on behalf of one of its owners.

There will be no change in your taxes unless you also pay self-employment taxes or are subject to the 0.9% Medicare sur-tax for compensation, wages and tips exceeding $200,000 ($250,000 if married filing jointly, $125,000 if married filing separately).

Medicare (W-2 Box 5) wages, salaries, tips, etc.

Enter your total of all wages, salaries, tips, etc. that were subject to Medicare withholding. This is normally the amount shown on W-2 Form(s) in box 5 provided by an employer. Leave this amount as $0 if you are unsure of the amount or do not have access to your W-2 Form(s). If this amount is $0 the calculator will use the amount entered into the normal wages, salaries, tips, etc. entry field.

The Medicare wages can be different from the total wages, salaries and tips (W-2 Box 1) when you have non-taxable income subject to Medicare taxes, such as 401(k) contributions or non-taxable combat pay. The amount can also be different if you had taxable income not subject to Medicare taxes, such as health insurance paid by an S-Corporation for one of its owners.

There will be no change in your taxes unless you also pay self-employment taxes or are subject to the 0.9% Medicare sur-tax for compensation, wages and tips exceeding $200,000 ($250,000 if married filing jointly, $125,000 if married filing separately).

For this entry only enter the amount for the primary taxpayer, do not include your spouse.

Medicare (W-2 Box 5) spouse wages, salaries, tips, etc.

Enter your spouse's total of all wages, salaries, tips, etc. that were subject to Medicare withholding. This is normally the amount shown on W-2 Form(s) in box 5 provided by an employer. Leave this amount as $0 if you are unsure of the amount or do not have access to your spouse's W-2 Form(s). If this amount is $0 the calculator will use the amount entered into the normal wages, salaries, tips, etc. entry field.

The Medicare wages can be different from the total wages, salaries and tips (W-2 Box 1) when you have non-taxable income subject to Medicare taxes, such as 401(k) contributions or non-taxable combat pay. The amount can also be different if you had taxable income not subject to Medicare taxes, such as health insurance paid by an S-Corporation for one of its owners.

There will be no change in your taxes unless you also pay self-employment taxes or are subject to the 0.9% Medicare sur-tax for compensation, wages and tips exceeding $200,000 ($250,000 if married filing jointly, $125,000 if married filing separately).

For this entry only enter the amount for the spouse, do not include the primary taxpayer.

Taxable interest

Enter your total taxable interest. This should also include your spouse's taxable interest if you are married filing jointly. This is normally reported to you either form 1099-INT or form 1099-OID. It may also be found on Schedule K-1.

Tax-exempt interest

This amount is only used to calculate taxable Social Security Benefits and Earned Income credit. If these are not part of your return, this entry will not change your results. Enter your (and your spouse's if married filing jointly) total tax-exempt interest reported to you (and your spouse if you are married filing jointly) on Form 1099-INT or Form 1099-OID. Also include any amounts on 1099-DIV reported as exempt interest dividends. Don't include any interest earned in an IRA, Health Savings Account, MSA or Coverdell education savings account. Tax-exempt interest entered here will not be carried to the Alternative Minimum Tax (AMT) calculation.

Ordinary dividends (this includes any qualified dividends)

Enter your (and your spouse's if married filing jointly) total dividends for the year. This amount is normally reported to you on Form 1099-DIV. Note that your total ordinary dividends for the year will include as part of the total any qualified dividends received.

Qualified dividends

Enter your (and your spouse's if married filing jointly) total qualified dividends for the year. This amount is normally reported to you on Form 1099-DIV. Qualified dividends are the portion of your total ordinary dividends subject to the lower capital gains tax rate. Qualified dividends are typically dividends paid by a corporation in which you own stock (or a mutual fund that owns stock in the corporation).

Qualified dividends also have a minimum holding period of the underlying stock. For common stock dividends to be considered qualified dividends, you need to have owned the stock for at least 60 days during a 121 day period that starts 60 days before the ex-dividend date. The same rule applies for preferred stock for dividends attributable to periods totaling more than 366 days, but the holding period is 90 days during a 181-day period starting 90 days before the ex-dividend date.

Stock you own directly, not through a mutual fund or exchange traded fund, will report qualified dividends without regard to your holding period. If you bought or sold the stock during the year, you will need to determine if your ownership of the underlying stock meets the holding requirement.

Mutual funds and exchange traded funds will report qualified dividends with regard to their holding period of a stock owned by the fund. However, if you bought or sold fund shares during the year you will need to apply the same holding requirements to fund shares you own (or owned) as you would to a common stock. If you do not meet the holding requirement, qualified dividends reported to you by your fund should not be included as qualified dividends on your tax return.

Taxable refunds of state and local income taxes

If you did not itemize your deductions in the previous year, or you itemized deductions but elected to include sales taxes (instead of income taxes) this amount will be $0 regardless of any refund you received. Otherwise, the amount of your refund is taxable to the extent in which the over payment decreased your taxable income in previous year.

Alimony received

Enter the amount you received as spousal maintenance or alimony. Please note that a divorce or separation agreement executed after December 31^st, 2018 is generally not considered income by the spouse receiving the payment. An amount should be entered only if the agreement was executed on or before December 31^st, 2018. For more information see tax topic: 542 - Alimony.

Business income or loss (Schedule C & E subject to self-employment taxes)

This includes the total net profit (or loss) from self-employment which is reported on Schedule C. Also include net profit (or loss) reported on Schedule E, page 2 that is subject to self-employment taxes, such as being a general partner in a partnership. The calculator will use the amount entered to calculate your Schedule SE self-employment tax.

Spouse business income or loss (Schedule C & E subject to self-employment taxes)

This includes a spouse's total net profit (or loss) from self-employment which is reported on Schedule C. It should also include a spouse's net profit (or loss) reported on Schedule E, page 2 that is subject to self-employment taxes, such as being a general partner in a partnership. The calculator will use the amount entered to calculate your spouse's Schedule SE self-employment tax.

Short-term capital gain or loss

This is the total profit you realized from the sale of assets such as stocks, bonds, collectibles, and other asserts owned less than one year. Short-term capital gains are taxed at regular income tax rates. For taxpayers above the income threshold for the Net Investment Income Tax (NIIT) there is an additional 3.8% NIIT tax.

Long-term capital gain or loss

This is the total profit you realized from the sale of assets such as stocks, bonds and real-estate owned more than one year. long-term capital gains are taxed at lower, special capital gains rates and are calculated as follows (note that qualified dividends are taxed as if they were a long-term capital gain):

• Calculate your total taxable income without long-term capital gains.
• Use this amount to determine the rate for your long-term gain, up to the top of the bracket.
• The portion of your long-term capital gain that exceeds a bracket will be taxed at the next higher rate.
• This calculator assumes that none of your long-term capital gains come from collectibles, section 1202 gains or un-recaptured 1250 gains. These types of capital gains are taxed at 28%, 28% and 25% respectively (unless your ordinary income tax bracket is a lower rate).

Other gains or losses

Other gains or losses not reported elsewhere. If you sold or exchanged assets used in a trade or business you may need to use Form 4797. Gain or Loss reported on Form 4797 is usually reported as part of the business on schedule C or Schedule D and not as an "other gain or loss".

Taxable IRA distributions

Enter any IRA distributions that are taxable. This would normally include distributions from a Traditional IRA, simplified employee pension (SEP) IRA, or a SIMPLE IRA. This also includes conversions of any of these IRA accounts to a ROTH IRA. If in previous years you made any contributions to your Traditional, SEP, or SIMPLE IRA that were not tax-deductible, some of your distribution may not be subject to tax. See Form 8606 and its instructions for tax treatment in any of these situations.

Do not include any SEP, SIMPLE or Traditional IRA distributions that were rolled over to a Traditional IRA account. Do not include Roth to Roth rollovers or qualified ROTH IRA distributions.

Taxable pensions and annuity distributions

This is the taxable portion of payment made by a pension or an annuity. This also includes distributions from Traditional 401(k), 403(b) and governmental 457(b) plans. Generally speaking, if you did not pay for an annuity or pension yourself, or if all contributions were made with pre-tax money, then all distributions will be fully taxable. If you purchased an annuity with after-tax money (for example from your personal savings NOT a retirement account), distributions from the annuity will have the taxable portion reduced by the amount paid for the annuity. This reduction in taxability is spread out over the remaining projected lifetime of the annuity owner. See 1040 instructions.

Intangible drilling costs (IDC) for investor general partners (this is an income reduction)

Oil and gas investment, when done as a general partner, can have intangible drilling costs that are considered an immediate loss of capital. This type of income reduction is both complex in its form and requirements. Please consult the IRS Oil and Gas Handbook for more information.

Income from rentals, royalties, non-qualified annuities, S Corporations and Schedule E (not already included and subject to NIIT)

This type of investment income is subject to the 3.8% Net Investment Income Tax (NIIT). Any income already reported on another line should not be included here. Generally speaking this is income from any businesses that are passive activities to the taxpayer, and not reported elsewhere (for example, do not include income subject to self-employment taxes). This could include income from rental real estate, royalties, non-qualified annuities, partnerships, S corporations, trusts, etc. There are exceptions and additional rules that can impact whether a particular business or investment income is subject to the NIIT. Please contact your tax professional for additional information.

Income from rentals, royalties, S Corporations and Schedule E (not already included and not subject to NIIT)

This is all income from any businesses that are NOT passive activities to the taxpayer, where the taxpayer materially participates, and not reported elsewhere (for example, do not include income subject to self-employment taxes). This amount is not subject to the 3.8% Net Investment Income Tax (NIIT). This could include income from rental real estate, partnerships or S corporations where the income is considered non-passive. There are exceptions and additional rules that can impact whether a particular business or other investment income is subject to the NIIT. Please contact your tax professional for additional information.

Farm income or loss (Schedule F)

Farm income or loss (losses are entered as a negative number). Farm income is subject to self-employment taxes, which are automatically calculated.

Total unemployment compensation

Enter any unemployment compensation you (and your spouse if you are married filing jointly) received during the year.

Social Security benefits received

This is the total of all Social Security and equivalent Railroad Retirement benefits you and your spouse (if you are married filing jointly) received in 2023. These benefits are reported to you on Forms SSA-1099 for Social Security and RRB-1099 for Railroad Retirement benefits.

Taxable income adjustments for Social Security and student loan interest

This is for a group of income items and benefits normally excluded from your taxable income but included when calculating any of the following: 1) The amount of Social Security benefits that are taxable, 2) Phaseout of student loan interest deduction. This amount is the total of the following:

1. Employer-provided adoption benefits excluded from your income (Form 8839)
2. Foreign earned income or housing that was excluded from your income (Form 2555)
3. Any exclusion of income for Bona Fide Residents of American Samoa (Form 4563) or Puerto Rico.
4. Interest on US Savings Bonds.

Taxable Social Security benefits

A portion of your Social Security benefits and equivalent Railroad Retirement benefits are included in your Total Income (and subject to income taxes and any other tax rules that are based on your total income) when your income exceeds certain thresholds. Note that the calculation does not include the impact of a lump-sum election for payments received for prior year's benefits. An overview of the calculation (the detailed worksheet is part of IRS Publication 915) is described below.

1. Calculate modified total income (MTI): Total Income (without Social Security Benefits or U.S. savings bond interest excluded from income) + 50% of your total Social Security benefits + Taxable Social Security income adjustments (employer-provided Adoption benefits excluded from your income, Foreign earned income or housing excluded from your income, income for bona fide residents of American Samoa (Form 4563) or Puerto Rico) + Tax exempt interest.

2. Calculate modified total adjustments (MTA): Total adjustments minus any amounts for student loan interest deduction.

3. Calculate modified adjusted gross income (MAGI): MTI- MTA

4. If MAGI is less than the 'Base Amount' for your filing status, none of your Social Security benefit is included in your income.

5. If MAGI is greater than the 'Base Amount' for your filing status, The Taxable Social Security benefit added to your Total Income is the sum of the following two calculations:
   • For each $1 of MAGI over the 'Base Amount' for your filing status $0.50 is Taxable. This total is limited by 1) 50% of your Social Security benefits or 2) 1/2 of the '50% Phaseout' whichever is less.

   • For each $1 of MAGI over the 'Base Amount'+'50% Phaseout' for your filing status $0.85 is Taxable.

6. Taxable Social Security income is limited to 85% of your Social Security benefits.

Other income

Any other income you received during the year but not reported on another form. This could include income reported to you on 1099-MISC that was not already reported elsewhere, lottery and gambling winnings, prizes and awards, canceled debt, and the Alaska Permanent Fund Dividend.

Total income

Total income is calculated by adding all income lines on your Form 1040. For most taxpayers this includes wages, salaries, tips, interest, dividends and gains and losses from a variety of activities.

Educator expenses

If you were an 'eligible educator' in 2023 you are able to deduct up to $300 in expenses. If you are married filing jointly and both of you are 'eligible educators' the limit is $600 ($300 each). Eligible educators include kindergarten through 12th grade teachers, instructors, counselors, principals, or aides who worked in a school for at least 900 hours during the school year. The expenses can be for professional development courses related to what you teach or supplies you use in the classroom. Home schooling expenses do not qualify and nor do expenses that were reimbursed. Your total expenses must be reduced by any savings bond interest that was nontaxable for higher education expenses, nontaxable qualified tuition program earnings or distributions, and nontaxable distributions of Coverdell education savings account earnings.

Employee business expenses (Form 2106 which includes military reservists and limited other employees)

This income deduction only applies to employee business expenses of Armed Forces reservists, qualified performing artists, fee-basis state or local government officials and employees with impairment-related work expenses. This includes non-reimbursed business expenses for vehicles, parking fees, tolls, transportation, lodging and other business expenses. Meals and entertainment are included but may be limited to 50% of the expense incurred.

Health Savings Account (HSA) deduction (Form 8889)

Enter your Health Savings Account (HSA) contributions for 2023. The maximum contribution is $3,850 for single coverage and $7,750 for family coverage. Those 55 and older can contribute an additional $1,000 as a catch-up contribution. To qualify for the deduction, you must have had a High Deductible Health Plan (HDHP) and contributed to your HSA account. Amounts contributed by your employer are not deductible. See Form 8889 for more information.

One-half of self-employment tax (Schedule SE)

This amount is calculated for you. It is one-half (50%) of your total self-employment tax. Please see 'Self-Employment' tax for details on how this is calculated.

Self-employed SEP, SIMPLE and qualified plans

If you are self-employed and made contributions to retirement plan such as a SEP, SIMPLE or other qualified plan enter that amount here. For more information about these plans and contribution rules see publication 560.

Self-employed health insurance deduction

Your health insurance premiums can be deducted from your taxable income if you are self-employed with net self-employment income, a partner with net earnings from self-employment, or received wages from an S corporation that you owned more than 2%. Note that for S corporations you can only deduct the premiums if they are reported as wages on your W-2. For the self-employed and for partnerships, neither you or your spouse can be eligible for health insurance from an employer to receive this deduction.

Penalty on early withdrawal of savings

Enter any amounts from Form 1099-INT or Form 1099-OID that show a penalty for early withdrawal of savings. These penalties are usually incurred when you withdraw money from a certificate of deposit or a time-deposit account before it matures.

IRA deduction

Enter any Traditional IRA contributions that are tax-deductible. Traditional IRA contributions are normally tax-deductible. However, if you have an employer-sponsored retirement plan, such as a 401(k), your tax deduction may be limited.

Student loan interest deduction

Enter the total student loan interest you (and your spouse if married filing jointly) paid for the year. Your allowable deduction is phased-out starting at $70,000 ($145,000 married filing jointly) and is completely eliminated at $85,000 ($175,000 married filing jointly). The calculator will automatically determine any phaseout amounts based on your income.

Alimony paid

Payments for your spouse or former spouse as part of a divorce or separation agreement executed on or before December 31^st, 2018 may qualify as an alimony payment deduction. Alimony is deductible by the payer spouse and is reported as income by the recipient for divorce or separations executed on or before December 31^st, 2018. For more information see tax topic: 542 - Alimony or 2017 Tax Cuts and Jobs Act PART V—DEDUCTIONS AND EXCLUSIONS (Opens in a new Window).

Total adjustments

Total of all of your adjustments. This is sometime referred to as "above the line" deductions since they do not require filing Schedule A for itemized deductions. Total income minus your total adjustments equals your Adjusted Gross Income (AGI).

Adjusted gross income

Adjusted gross income (AGI) is calculated by subtracting all deductions from the 'Adjusted Gross Income' section from your total income. AGI is used to calculate many of the qualifying amounts if you itemized your deductions.

Standard deduction

Your standard deduction is used to reduce your taxable income if you do not use Schedule A to itemize your deductions, or if your Schedule A itemized deduction is less than your standard deduction. Your standard deduction is based on your filing status. For 2023, the standard deductions are:

Medical and dental expenses

Enter your qualified medical and dental expenses for the year. This can include your health insurance premiums if you paid for them yourself (not through an employer sponsored plan) and you have not deducted them elsewhere. Your actual deduction is only for the amount that exceeds 7.5% of your Adjusted Gross Income (AGI). Enter your total expenses and the tool will calculate the actual deduction based on your AGI.

Taxes paid (generally state and local)

Enter the total of your 1) state and local property taxes and 2) state and local income taxes. If your state does not have an income tax (or you have paid more sales tax than income tax during the year) you can choose to include state and local sales tax paid instead of state and local income taxes. You are limited to a maximum $10,000 deduction for taxes paid.

Interest paid

Taxpayers can deduct the interest paid on qualified residences for up to $750,000 in mortgage debt (the limit is $375,000 if married and filing separately). For mortgages that were originated before December 15, 2017, the limit is $1 million in total mortgage debt. This includes refinancing these mortgages as long as the amount owed is not increased as part of the refinancing.

Any interest paid on first, second or home equity mortgages over the limit is not tax-deductible. Only home equity loans that are used to buy, build or substantially improve the home that secures the loan are included. All other home equity loans do not have an interest deduction. Mortgage interest is reported on Form 1098.

You can also include the amount you paid for "points" (which reduces your mortgage interest rate).

Gifts to charity (cash)

Enter your total gifts of cash to qualified charitable organizations (check, credit card, actual cash, payroll contributions or 'texted' contributions include on your phone bill). If you itemize on Schedule A, 2023 allows you to deduct up to 60% of your Adjusted Gross Income (AGI). Note that cash donations do not qualify for a tax deduction unless you itemize your deductions on Schedule A and you choose to use your Schedule A Itemized Deductions rather than your standard deduction.

Gifts to charity (non-cash)

Enter your total gifts of non-cash to qualified charitable organizations. The amount should be the fair market value of those gifts, not the amount originally paid. Note that non-cash donations do not qualify for a tax deduction unless you itemize your deductions on Schedule A and you choose to use your Schedule A Itemized Deductions rather than your standard deduction. In addition, most non-cash gifts are limited to 50% of your Adjusted Gross Income (AGI). This calculator will limit your gifts to 50% of your AGI when calculating your taxes. It is beyond the scope of this calculator to calculate the special situations that may have different deductible limitations. You may include amounts in this line that were not allowed on previous year's Schedule A due to the AGI limitation but the total will remain limited to 50% of your AGI.

Itemized deduction

Your total itemized deductions from Schedule A.

Do not use standard deduction

Check this box to use your Schedule A Itemized Deductions even if the standard deduction would produce a lower tax amount. For example, if you are married filing separately and your spouse is itemizing their deductions, you are not able to use the standard deduction on your return. Checking this box will calculate your tax with your itemized deductions and disregard the standard deduction.

Standard or itemized deduction

This is the higher of your Standard Deduction or your Itemized Deduction. If you checked 'do not use standard deduction' this is always your Itemized Deductions.

Qualified business income deduction (Form 8995)

The Qualified business income deduction (QBID) reduces your taxable income by 20% of your qualified business income, subject to certain limitations. Calculating your QBID is not included in this calculator but you can estimate the amount with the rates in the 'Income Thresholds QBID' table. Your QBI will be reported on your Schedule K-1 or Schedule C for a sole proprietorship. See irs.gov for more information.

Which entities are considered Specified Service Trade or Business (SSTB) is not clearly defined. The following are specifically identified as NOT a SSTB: real estate brokers, property managers, architecture, engineering and bankers. For all other businesses you are considered a SSTB if you are in the trade or business of performing services as an employee – or – if the business is a Specified Service Trade or Business (SSTB) as defined by Section 1202(e)(3)(A).

Section 1202(e)(3)(A) includes any trade or business involving the performance of services in the fields of health, law, accounting, actuarial science, performing arts, consulting, athletics, financial services, brokerage services, or any trade or business where the principal asset of such trade or business is the reputation or skill of one or more of its employees.

Taxable income

This is your Adjusted Gross Income (AGI) minus your standard deduction (and permitted cash donations) or itemized deduction (whichever is larger) minus any Qualified Business Income Deduction (QBID).

Income tax

This is the total federal income tax you owe for 2023 before any tax credits, AMT or other non-income taxes.

Foreign tax credit (Form 1116)

Any foreign tax credit per Form 1116.

Child and dependent care credit (Form 2441)

This is a credit for daycare for children under age 13 or other dependents during a time when they are unable to care for themselves. The taxpayer, and spouse if married filing jointly, must work, looked for work or been a full-time student. The maximum allowed expenses are $3,000 for the first eligible child and $6,000 for two or more eligible children. The credit starts at 35% of the expenses for adjusted gross income up to $125,000. The credit drops slowly to 20% of expenses and fully phases out for adjusted gross income greater than $438,000. See for 2441 for complete instructions.

Education credits (Form 8863, line 23)

Enter any education credits you can claim from Form 8863 line 23.

Retirement savings contributions credit (Form 8880)

Enter any retirement savings contribution credit you can claim from Form 8880.

Dependent tax credit for other dependents

A $500 nonrefundable credit for each dependent who is not a qualifying child.

Residential clean energy credit (Form 5695)

This is a credit for residential installation of qualified energy saving or producing equipment. This includes qualified solar electric generating equipment, solar water heating equipment (other than for hot tubs and pools), geothermal heat pumps, wind energy generators or fuel cell power plants. The credit is 30 percent of qualifying expenses. This credit was renewed through 2032. See Form 5695 for more information.

American opportunity credit (Form 8863)

Enter the total American opportunity credit that you are able to claim from Form 8863. This amount is limited to $2,500 per eligible student.

American opportunity credit non-refundable

Any non-refundable portion of an American opportunity credit (AOTC) that you are able to claim.

Other credits that are not refundable

Enter any other tax credits you can claim. Tax credits entered here will not reduce your tax liability below zero (these are non-refundable credits).

Alternative minimum tax (AMT) income adjustments

Alternative Minimum Tax (AMT) income adjustments will be added to your Alternative Minimum Tax Income (AMTI) when calculating AMT. Please do not include any itemized deductions or taxable refunds for state and local taxes, they are handled separately. Income adjustments to include would be additional items on Form 6251. Enter your total (either actual or estimated) amount here. It is beyond the scope of this calculator to determine all of the individual AMT income adjustments.

Alternative minimum tax

The alternative minimum tax is an alternative tax for high income taxpayers. There are only two tax rates 26% or 28% that replace the normal income tax rates. Please see Form 6251 Alternative Minimum tax - Individuals for more information. A summary of how the Alternative Minimum Tax (AMT) is calculated is as follows:

1. Start with your Taxable income and add back taxes paid if using Itemized deductions or the standard deduction if you do not itemized deductions.
2. Add income adjustments per Form 6251. This includes a multitude of adjustments such as income for depletion, net operating losses, exercise of incentive stock options, estates and trusts, disposition of property, loss limitations and other differences between AMT income and regular tax income. It is beyond the scope of this calculator to determine all of the AMT income adjustments. Enter your total (either actual or estimated) amount into the entry for "Other alternative minimum tax income adjustments".
3. Subtract your AMT exemption amount, based on your filing status and the AMT Modified AGI to get your AMT Income (AMTI). Your exemption amount is decrease by 25% of any AMTI over the exemption phaseout threshold.

   Alternative Minimum Tax Exemption Amount by Filing Status 2023

   Filing Status	Exemption Amount	Exemption Phaseout Threshold
   Married Filing Jointly	$126,500	$1,156,300
   Qualified Widow(er)	$126,500	$1,156,300
   Single	$81,300	$578,150
   Heads of Household	$81,300	$578,150
   Married Filing Separately	$63,250	$578,150

4. Your AMT tax is calculated as 26% of AMTI up to $220,700 ($110,350 for married couples filing separately) plus 28% of all AMTI over $220,700 ($110,350 for married couples filing separately).
5. If the AMT tax calculation results in an amount that is greater than your normal income tax, you owe the difference as AMT.

Excess advance premium tax credit reconciliation (Form 8962)

Taxpayers with health insurance from their State Health Insurance Marketplace generally get a prepaid credit sent directly to the insurance company. This credit is used to reduce or eliminate the cost of health insurance. The Marketplace uses IRS Form 1095-A to report the amounts received. Taxpayers who get Marketplace Health Insurance must reconcile the information on IRS Form 8962 using their Form 1095-A. The reconciliation can result in an additional tax or a refund of excess premiums paid out-of-pocket by the taxpayer.

Self-employment tax

Self-employment tax (schedule SE) is calculated by taking your total 'net farm income or loss' and 'net business income or loss' and multiplying it by 92.35% (this is done to adjust your net income downward by the total employment tax that would have been paid by an employer, had you not been self-employed). If the result is less than $400.00, you do not owe any self-employment tax on this income.

If the result is greater than $400 you owe self-employment taxes. In 2023, income up to $160,200 is subject to the 12.4% tax paid for the Social Security portion of self-employment taxes (FICA). All self-employment income is subject to the Medicare tax of 2.9%.

If you were also an employee during the year, your employee wages counts toward the $160,200 threshold where the Social Security tax ends. If your total employee wages exceed $160,200 in 2023 you will not owe additional Social Security taxes for self-employment. You will, however, still owe the Medicare 2.9% tax.

Unreported Social Security and Medicare tax (Form 4137)

Enter any Social Security and Medicare tax you owe from unreported tip income. See Form 4137 for more information.

Additional tax on IRAs and other retirement plans (Form 5329)

If you made withdrawals from any IRA, qualified retirement plan or other tax-advantaged account and owe a 10% early withdrawal penalty (or other penalty) enter the penalty amount here. Please see Form 5329 Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts.

Household employment taxes (Schedule H)

Enter any household employment taxes you owe (use Schedule H to determine this tax amount).

First-time home buyer credit repayment (Form 5405)

If you received a first-time homebuyer credit and sold your home, you may have to repay part of the original credit. Please see Form 5404 for more information.

Medicare tax sur-tax on earned income (Form 8959)

Income, such as wages and self-employment earnings, that were subject to Medicare taxes have sur-tax of 0.9% for amounts exceeding $200,000 ($250,000 if married filing jointly, $125,000 if married filing separately). This is automatically calculated based on all income entered as wages, salaries, tips, etc., all income entered as Business income or loss (Schedule C & E subject to self-employment taxes) and Farm income (Schedule F).

Net Investment Income Tax (NIIT) (Form 8960)

Investment income is subject to the Net Investment Income Tax (NIIT) when you have net positive investment income. Net investment income is total of all investment income, subject to the tax, where losses can offset gains in any given year. Any business income or loss that is subject to Self-Employment taxes is never considered investment income neither is business income from organizations where you actively participate (such as many S Corporations and Partnerships). The tax is 3.8% for all amounts above income thresholds for your filing type.

Federal income tax withheld on Forms W-2 and 1099

Total of all Federal income taxes withheld for the year. This would typically be reported to you on Form W-2 for employment wages and Form 1099 for other income.

Additional child tax credit (Form 8812)

If you qualify for the child tax credit you may be eligible for an additional refundable credit. This additional credit is considered refundable because it is 'refunded' or paid to you even if you don't have enough income taxes to offset the credit (it will result in a total income tax bill for the year that is negative). In 2023, the refundable credit is limited to $1500 per child.

Earned Income Credit (EIC)

Earned Income Credit (EIC) is a tax credit available to low income earners. In some cases the EIC can be greater than the total income taxes owed for the year. This provides an income tax refund to families that may have little or no income tax withheld from their paychecks. This calculator will determine if you qualify for the Earned Income Credit, and if so, how much.

Number of qualifying children

Enter the number of children in your family that qualify for the Earned Income Credit (EIC). The IRS has a set of three requirements that must be met to have a child considered qualified.

1. Your relationship to the child must be:
   • Son, daughter, stepchild, eligible foster child, or a descendant (for example, your grandchild) of any of them, or
   • Brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of them (for example, your niece or nephew).
   
   
2. Your child must be:
   • Under age 19 at the end of 2023 and be younger than the person claiming the child or
   • A full-time student under age 24 at the end of 2023 and be younger than the person claiming the child, or
   • Permanently and totally disabled at any time during 2023, regardless of age.
   
   
3. Not have filed a joint return other than to claim a refund
4. Your child must have lived with you in the United States for more than half of 2023.

Earned income

This is any income from wages, salaries, tips or any other earned income that is taxable. Do not include any non-taxable benefits in this total. Also include any earnings from farms, farm partnerships or businesses that did not require payment of self-employment taxes. Do not include any scholarships, penal income, annuity or pension income.

Scholarships, penal & retirement income

If you received income from any of these sources, it does not qualify for the Earned Income Credit. Your eligible Earned Income is reduced by this amount.

Non-taxable combat pay

If you received any non-taxable combat pay, the IRS allows you choose whether to figure your EIC with or without this pay included. This calculator will automatically choose the option that produces the highest EIC.

Are you (or spouse if married) at least age 25 but under age 65?

Check this box if you or your spouse will be at least age 25 and less than 65 years old at the end of the tax year. This rule only applies to people without any children. Your response is not used if you have 1 or more qualified children.

Can you (or spouse if married) be claimed as a qualifying child of someone else?

You cannot be a qualifying child of another person and receive Earned Income Credit. If you meet the requirements to be a qualifying child of your parents based on the EIC rules, you are unable to claim any EIC for yourself. This is the case even if your parent or parents do not qualify for EIC and whether or not you have any qualifying children of your own.

Have you (and spouse if married) lived in the U.S. for at least six months?

Check this box if you (and your spouse if married) lived in the United States for more than six months of the year. You must have lived in the U.S. for at least six months and one day during the current year. This only applies if you do not have any qualified children. For military personnel, you are able to include any time spent on extended deployment as living in the U.S.

Total credits

Your total tax credits. This amount is subtracted from the total tax amount.

Total payments

Total of all tax payments made in 2023. This includes tax withheld from Forms W-2 and 1099, and estimated taxes paid, earned income credit and excess Social Security tax withheld.