FAQ Friday: What is my tax bracket?

Income tax is based on your income after personal exemptions, standard or itemized deductions, and other adjustments are subtracted. A tax bracket is the rate at which the top of your income is taxed, but not all of it. Someone in a 28 percent tax bracket has part of their income taxed at 10 percent and part at 25 percent, with only the highest portion at 28 percent. The tax bracket tells you how much you will have to pay in federal income tax on each additional dollar you make.

2010 Federal Tax bracket	Single	HOH	MFJ or QW	MFS
	For income over...
10%	$0	$0	$0	$0
15%	$8,375	$11,950	$16,750	$8,375
25%	$34,000	$45,550	$68,000	$34,000
28%	$82,400	$117,650	$137,300	$68,650
33%	$171,850	$190,550	$209,250	$104,625
35%	$373,650	$373,650	$373,650	$186,825

The federal Form 1040 actually collects several other taxes including:
• Self employment (Social Security and Medicare) tax
• Social Security and Medicare tax on tip income
• Early withdrawal tax on IRA's and retirement plans
• Household employee payroll tax ("nanny tax")
• Alternative minimum tax