Calculate Your Income Tax May 2026

: Rental income, gambling winnings, and distributions from retirement accounts. 📉 Step 2: Determine Your Adjusted Gross Income (AGI)

You must decide between taking a fixed "standard" deduction or listing specific "itemized" expenses. Choose whichever is higher to lower your taxable income the most. Filing Status Deduction Amount Single / Married Filing Separately Married Filing Jointly Head of Household

: Payments to a Traditional IRA or 401(k). calculate your income tax

Calculating your income tax involves a multi-step process that transforms your total earnings into a final amount owed or a refund. For the 2026 tax year, recent legislation like the One, Big, Beautiful Bill (OBBB) has permanently set tax rates while adjusting brackets and deductions for inflation. 🏗️ Step 1: Calculate Your Gross Income

: Interest from bank accounts, dividends from stocks, and capital gains from selling assets. : Rental income, gambling winnings, and distributions from

: State and local taxes, now capped at $40,400 for most filers. Mortgage Interest : Interest on up to $750,000 of home debt.

You can reduce your gross income by taking "above-the-line" deductions. These are available even if you don't itemize. Filing Status Deduction Amount Single / Married Filing

: Up to $300 for K-12 teachers purchasing classroom supplies.