Tax Guide & Calculators

How the U.S. Tax System Actually Works

The federal income tax is progressive — you pay higher rates only on income that crosses into higher brackets, not on all your income. Your effective rate (total tax / total income) is always lower than your marginal rate (the rate on your last dollar). Understanding that one distinction will make you smarter than 80% of people about taxes.

2026 Federal Tax Brackets (Single)

Rate	Taxable Income
10%	$0 - $11,925
12%	$11,925 - $48,475
22%	$48,475 - $103,350
24%	$103,350 - $197,300
32%	$197,300 - $250,525
35%	$250,525 - $626,350
37%	$626,350+

Standard Deduction vs Itemized

Everyone gets to subtract a standard deduction from income before brackets apply. In 2026 that's $15,750 single / $31,500 joint / $23,625 head of household. Most people take the standard. You itemize only if your deductions (SALT cap $10k, mortgage interest, charitable giving, medical expenses over 7.5% of AGI) exceed the standard amount.

Tax-Advantaged Accounts: The Fast Path to Lower Taxes

401(k) — up to $23,500 pre-tax

Contributions reduce your taxable income dollar-for-dollar. At a 24% marginal rate, maxing a 401(k) saves $5,640 in tax today. The trade-off: you'll pay tax when you withdraw in retirement.

HSA — up to $4,400 single / $8,750 family

The Holy Grail of tax accounts. Triple-tax-advantaged: contributions are deductible, growth is tax-free, withdrawals for medical expenses are tax-free. If you're healthy and can pay medical bills out of pocket, let the HSA grow as a stealth retirement account.

IRA — up to $7,000 ($8,000 if 50+)

Traditional IRA: deductible if under income limits, tax-deferred. Roth IRA: no deduction, tax-free withdrawals in retirement. Young people in low brackets should lean Roth; high earners in their peak years should lean Traditional or use backdoor Roth strategies.

FSA — up to $3,300 annual (2026)

Pre-tax money for medical expenses. Use-it-or-lose-it rules apply (small carryover allowed). FSA wins if you have predictable annual medical costs — dental, glasses, copays.

FICA — The Tax Hiding in Plain Sight

FICA is 7.65% of your wages: 6.2% for Social Security (on the first $176,100 in 2026) and 1.45% for Medicare. It funds federal retirement and health programs. If you're self-employed (1099), you pay both halves (15.3%) but deduct half on your Form 1040.

Filing Statuses That Matter

• Single — unmarried, no dependents. Smallest brackets, smallest standard deduction.
• Married Filing Jointly — combines both spouses' income. Larger brackets, often lowest effective rate.
• Married Filing Separately — almost always worse than joint, but required in certain legal situations.
• Head of Household — unmarried with qualifying dependents. More favorable than single brackets.
• Qualifying Surviving Spouse — available for up to 2 years after spouse's death if qualifying child lives with you.

Common Tax Mistakes to Avoid

1. Not contributing to employer 401(k) up to the match
2. Forgetting state tax deductions (contribution accounts, state-specific credits)
3. Over-withholding to get a big refund (you're giving the IRS an interest-free loan)
4. Missing quarterly estimated tax if you're self-employed (hello, underpayment penalty)
5. Not keeping records of charitable donations, HSA distributions, or investment cost basis

When to Hire a CPA

DIY with software (TurboTax, FreeTaxUSA, CashApp Taxes) is fine if you have: W-2 income only, standard deduction, simple brokerage 1099s. Hire a pro if you have: self-employment, K-1 income, rental property, multi-state income, equity compensation (RSUs/ISOs/NSOs), large charitable trusts, or over $300k household income.