Federal income tax

The U.S. has two separate

income tax systems: Federal and State. The Federal tax is administrated by the IRS (Internal Revenue Service) and imposed by the IRC (internal Revenue Code) on net taxable income (gross income minus tax deductions).

Marginal tax rates

    Taxable income:                   Tax:
  Over     But not over         Tax       +%   On amount over            

$      0     $  9,075        $    0.00   10       $      0
   9,075       36,900           907.50   15          9,075
  36,900       89,350         5,081.25   25         36,900
  89,350      186,350        18,193.75   28         89,350
 186,350      405,100        45,353.75   33        186,350
 405,100      406,750       117,541.25   35        405,100
 406,750      .......       118,118.75  39.6       406,750