IRS income tax rates: everybody falls into one of them

The IRS income tax rates can seem to be a very complicated process and system of numbers if looked at as a whole. Once a person breaks down the numbers and classifications into smaller pieces it is easier to understand.

A good example of this would be how taxes are figured for a person making $200,000 a year as the gross adjusted income. The first step is to see at what level or bracket they fall into, single, married filing jointly, married filing separately or head of household.

If the person is single then one would presume they would fall into the 33% tax bracket. This is true to a point. The last of their earnings would be taxed at that rate but not the beginning. The first part of their income from $0 to $8,350 would be taxed at 10%. The next part from $8351 to $33,950 will be taxed at 15%. From $33,951 to $82,250 will be at 25%. From $82,251 to $171,550 will be at 28%. And the last from $171,551 to $200,000 will be at 33%.

Then take these numbers and you can figure out the total tax as a whole. (8,350-0) X 0.10= 835, (33,950-8,351) X 0.15 = 3,840, (82,250-33,951) X 0.25 = 12,075. (171,550-82,251) X 0.28 = 25,004, (200,000-171,551) X 0.33 = 9,388. The total tax would be $51,142 or 25.6% as an overall tax rate.

When looked at this way most people feel a little better. 25.6% tax rate is better than thinking you are paying 33%. When broken down the IRS income tax rates are simple and easy to understand, just do the math.

It is essential to get qualified council when dealing with income tax law and related matters. Research on the computer is a great method for keeping your hourly attorney bills low, but always check your findings with a licensed attorney or accountant before making any financial or business decisions. If you need more information about filing extension tips or other tax topics, visit us today at http://www.irs-help-tax.com.