How the Income Tax Calculator works
Estimate take-home pay from an average tax rate. Adjust the inputs above, then use the calculate button to generate a fresh estimate based on the numbers you entered.
The result is designed to give you a quick planning number, plus a short breakdown of the major figures behind it. You can reset the form at any time and try a different scenario.
When to use this calculator
Use this income tax calculator for a quick estimate of after-tax income from an average tax rate. It is useful for rough budgeting, offer comparisons and checking how much income may remain after taxes.
Formula
After-tax income = annual income x (1 - average tax rate)
- Annual income is the gross income before tax.
- Average tax rate is the overall percentage of income paid in tax.
- After-tax income is the simplified take-home estimate.
Worked example
For $85,000 of annual income and a 24% average tax rate, the calculator estimates $64,600 of after-tax income.
Common mistakes
- Using a marginal tax rate when the calculator asks for an average tax rate.
- Assuming this replaces tax software or professional tax filing.
- Ignoring payroll deductions, credits, benefits or local taxes.
FAQs
Is this a tax filing calculator?
No. It is a simplified planning estimate based on an average tax rate.
What is an average tax rate?
It is total tax divided by total income, unlike a marginal rate which applies to the next dollar earned.
Does this include deductions or credits?
No. Use the average tax rate field to approximate your overall tax situation.