How this calculator works
The calculator starts with your adjusted gross income and subtracts the 2026 standard deduction: $16,100 for single filers and $32,200 for married couples filing jointly. People aged 65 or older add $2,050 (single) or $1,650 per spouse (married).
Four deductions created for 2025 to 2028 are then taken, whether or not you itemize. Tips: up to $25,000. Overtime premium: up to $12,500, or $25,000 joint. Both shrink by $100 for every $1,000 of income over $150,000 ($300,000 joint).
Senior deduction: $6,000 for each person aged 65 or older, reduced by 6% of income over $75,000 ($150,000 joint), so it is gone at $175,000 ($250,000 joint). Married couples must file jointly to claim it.
Car loan interest: up to $10,000 of interest on a loan for a new vehicle assembled in the US, taken out after 2024. The limit falls by $200 for every $1,000, or part of $1,000, of income over $100,000 ($200,000 joint).
Taxable income is then taxed in the 2026 brackets, from 10% to 37%. The table shows how much of your income falls in each bracket. Your effective rate is your tax divided by your income, which is always lower than your top bracket.
Worked example
Single, age 66, $85,000 of income
- Standard deduction: $16,100 + $2,050 for being 65 or older = $18,150.
- Senior deduction: $6,000 − 6% × ($85,000 − $75,000) = $5,400.
- Taxable income: $85,000 − $18,150 − $5,400 = $61,450.
- Tax: $1,240 (10%) + $4,560 (12%) + $2,431 (22%) = about $8,231, an effective rate of 9.7%.
Questions people ask
What are the 2026 federal tax brackets?
For single filers: 10% up to $12,400, 12% to $50,400, 22% to $105,700, 24% to $201,775, 32% to $256,225, 35% to $640,600 and 37% above. Joint filers’ thresholds are roughly double, with the 37% bracket starting at $768,700.
Do the new deductions require itemizing?
No. The tips, overtime, senior and car loan interest deductions are claimed on Schedule 1-A and can be taken along with the standard deduction.
Does the senior deduction replace the extra standard deduction for 65+?
No, they stack. A single person aged 65 or older gets the $16,100 standard deduction, the $2,050 additional amount and up to $6,000 more.
Why is my effective tax rate so much lower than my bracket?
Each bracket rate applies only to the income inside that bracket, and the standard deduction is never taxed. So someone in the 22% bracket typically pays 8% to 12% of their total income in federal income tax.
Sources
Last reviewed October 2, 2026